Banks rack up more record profitsA 42 percent jump in...

BUSINESS DIGEST

March 16, 1994

Banks rack up more record profits

A 42 percent jump in profits in the fourth quarter swelled U.S. bank earnings to $43.4 billion for 1993, shattering the previous annual high by more than one-third, regulators said yesterday.

The second straight yearly record came as falling interest rates helped the country's lending institutions once again. Banks benefited from the spread between what they earned on loans and other assets and what they paid out to depositors.

Also during 1993, banks set aside the lowest amount of money for troubled loans in nine years.

Saudi telephone pact hinted

Only a month after Clinton administration officials helped secure a $6 billion commercial aircraft contract from Saudi Arabia, top officials are hinting that a $4 billion telecommunications contract could be next.

"We're very optimistic about the outcome of our talks with the Saudis," Commerce Secretary Ronald H. Brown told reporters after the close of a jobs conference in Detroit. "Saudi Arabia wants to put in 1.5 million new telephone lines."

Calvert Cliffs case in 2nd phase

A 3-year-old case to decide who will foot a $400 million bill for the two-year shutdown of the Calvert Cliffs nuclear power plant entered its second stage yesterday with the filing of new testimony with the Public Service Commission.

The Office of the People's Counsel, which represents ratepayers, in 1,000 pages of testimony argued that Baltimore Gas and Electric Co. should bear the full cost of buying replacement power while one or both reactors at the plant were shut down from May 1989 to May 1991. However, the PSC staff contends that BG&E is responsible for only $200 million of the expense, and that ratepayers should be responsible for the rest.

Realty investment firm liquidating

Columbia Real Estate Investments Inc., which invested in residential mortgages and securities backed by residential mortgages, said yesterday that its stockholders approved a plan to dissolve and liquidate the company. Citing low interest rates, the company's board voted in early December to seek shareholder approval of the plan, which calls for selling the company's assets and distributing the proceeds to shareholders.

Adobe Systems, Aldus to merge

Adobe Systems Inc. and Aldus Corp. -- two personal computer software companies that played crucial roles in the rise of the $2 billion desktop publishing industry -- yesterday announced their intention to merge in a stock swap valued at more than $500 million.

If approved by stockholders and regulators, the merger would create a company with annual revenues of $500 million. The deal is expected to be completed in July, the companies said.

Under the deal, Adobe would exchange 1.15 shares of its stock for each Aldus share.

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