Page 24 - ARUBA TODAY

Thursday 13 July 2017 BUSINESS
A24

Royal Bank of Scotland in $5.5B settlement over US mortgages

By DANICA KIRKA Agency — the conservator ment as a “stark reminder” said that the bank was 17th agreement reached
Associated Press of Fannie Mae and Freddie of the heavy price British “nearly through” with issues by the agency.
LONDON (AP) — Royal Mac — resolves claims re- taxpayer and the bank it- that have dogged efforts The 18 banks included two
Bank of Scotland said garding the issuance and self paid for the global am- to return to profit. other British banks, Barclays
Wednesday it has reached underwriting of approxi- bitions of the institution un- The Federal Housing Fi- and HSBC. They agreed to
a $5.5 billion settlement in mately $32 billion (25 billion der disgraced former boss nance Agency sued 18 pay $280 million and $550
the United States over the pounds) of residential mort- Fred Goodwin. major U.S. and foreign million, respectively, in set-
mis-selling of mortgage- gage-backed securities. “It’s never a great experi- banks in 2011 over their tlements with the FHFA in
backed securities before The bank must still resolve ence for a CEO to effec- sales of mortgage securities 2014. The U.S. government
the financial crisis — a key outstanding civil and crimi- tively be writing such a to Fannie and Freddie. The rescued Fannie and Fred-
milestone in the institution’s nal claims with the Depart- large check — 4.2 billion total price for the securities die at the height of the fi-
efforts to put its past sins ment of Justice. pounds,” McEwan said on sold was $196 billion. nancial crisis in September
behind it. The deal with the RBS CEO Ross McEwan a conference call with re- The settlement with Royal 2008 when they were on
Federal Housing Finance characterized the settle- porters. Nonetheless, he Bank of Scotland was the the verge of collapse. q

Yellen says Fed watching slowdown in inflation

By MARTIN CRUTSINGER edged that her appear-
AP Economics Writer ance Wednesday before
WASHINGTON (AP) — Fed- the House panel and on
eral Reserve Chair Janet Thursday before the Senate
Yellen raised the possibil- Finance Committee could
ity Wednesday that the be her last time to present
Fed would consider slow- the Fed’s semiannual Mon-
ing the pace of its interest etary Policy Report to Con-
rate increases if inflation re- gress.
mained persistently below Yellen, the first woman to
its target level. head the Fed in the cen-
For the moment, Yellen sig- tral bank’s 100 year history,
naled no change in policy, was asked several times if
indicating that the three she would accept another
rate hikes since Decem- term if President Donald
ber will likely be followed Trump offered it. She didn’t
by one more hike this year. provide a direct answer.
She also said the Fed wants “I am very focused on trying
to begin gradually trim- to achieve our congressio-
ming its massive $4.5 trillion nally mandated objectives
in bond holdings later this and I really haven’t had to
year, a move that will also give further thought at this
put upward pressure on in- Federal Reserve Chair Janet Yellen takes her seat on Capitol Hill in Washington, Wednesday, July point” to the question of
terest rates. 12, 2017, prior to testifying before the House Financial Services Committee. serving a second term, Yel-
But Wall Street investors (AP Photo/Jacquelyn Martin) len told Rep. Carolyn Malo-
took heart from her slightly len told lawmakers on the the federal funds rate, cur- ber or December. ney, D-New York.
more cautious view of a re- House Financial Services rently stands in a range of Yellen’s appearance took In her testimony, Yellen took
cent puzzling slowdown in Committee. “We’re watch- 1 percent to 1.25 percent. on a bit of a valedictory note of a number of en-
inflation, believing it could ing it very closely and stand The last three increases tone, given that her cur- couraging factors, includ-
signal that the Fed that ready to adjust our policy if occurred in December, rent four-year term as chair ing strong job gains and ris-
might be willing to put fur- it appears that the inflation March and June. Many will end in early February ing household wealth that
ther rate hikes on pause. undershoot will be persis- analysts believe the Fed will before the next round of she said should fuel eco-
“Monetary policy is not tent.” raise rates one more time congressional hearings. At nomic growth over the next
on a pre-set course,” Yel- The Fed’s key policy rate, this year, either in Septem- one point, she acknowl- two years.q

How Burberry used a popular Chinese app to boost sales

By CAROLINE SPIEZIO second quarter, more than vertising campaign on that competitors in luxury a fashion show.
Associated Press expected, thanks largely to WeChat for the launch of goods have yet to make. The company said that the
LONDON (AP) — In a bid a resurgence in mainland a new bag — the DK88, Some companies prefer to WeChat advertising was
to reinvigorate sales in the China, where sales had which retails for almost focus on physical stores to only part of its overall sales
massive Chinese market, slowed in recent years. $2,000 — saw its customer preserve the aura of luxury. strategy, which included
British luxury fashion brand Analysts note the company reach triple on the app. Also, some online shopping new physical stores.
Burberry this year used a boosted spending on the Sales growth in the country sites have been accused of “The company says they
strategy that has paid off WeChat app, which counts was in the mid-single digits, selling fakes. are seeing ‘top customers
handsomely: ramping up almost a billion users in Chi- above the global growth Burberry has prided itself on returning’ to their stores,”
advertising on China’s pop- na and serves as a multi- rate. combining digital market- said Steve Clayton, fund
ular WeChat social media purpose app combining Ken Odeluga, an analyst ing with sales, such as by al- manager at HL Select UK
app. social media and shopping for City Index, says that fo- lowing shoppers to immedi- Growth Shares. “In other
Burberry saw a 4 percent services. cusing so heavily on We- ately buy online what they words, the Chinese are
rise in overall sales in the The company said its ad- Chat is a strategic move see on the catwalk during spending again.”q