Business Digest


April 22, 2005

In The Region

Pinto named to head Mid-Atlantic division of M&T Bank Corp.

M&T Bank Corp. is moving its vice chairman and chief financial officer, Michael P. Pinto, from its Buffalo, N.Y., headquarters to Baltimore to run its Mid-Atlantic division.

Pinto will replace Eugene J. Sheehy, who was recently named chief executive of Allied Irish Banks PLC. Allied Irish sold Baltimore-based Allfirst Financial Inc. to M&T in 2002, giving it a share of the Buffalo bank.

Pinto joined M&T in 1985, working his way through the ranks to win a seat on its board two years ago. In his new role, Pinto will oversee operations in Maryland and four other states and the District of Columbia.

Guilford to resume clinical trials of sedative

Shares of Guilford Pharmaceuticals Inc. rose nearly 8 percent yesterday, to $2.47, after the Baltimore company announced plans to resume clinical trials of Aquavan, a sedative that executives said could produce sales of $300 million a year if approved for use in procedures such as colonoscopy.

The stock had plunged 34 percent in one day last month after the company announced the suspension of Aquavan trials because patients were experiencing deeper levels of sedation than desired.

The new trial strategy will factor in a range of dosing levels and cut clinical tests to five from 13. The company said it expects to file a new drug application with the Food and Drug Administration in the second half of 2006.

N.C. bank plans to open branch in Annapolis

First Citizens Bank of Raleigh, N.C., announced yesterday plans to open a branch in Annapolis.

First Citizens must gain regulatory approval from the Federal Deposit Insurance Corp. and the North Carolina Banking Commission. It expects to open the branch in the fourth quarter. First Citizens has 340 branches in North Carolina, Virginia and West Virginia.


SEC should have found fund abuses sooner, GAO finds

The Securities and Exchange Commission failed to uncover trading abuses throughout the mutual fund industry that cost investors billions because it had other priorities, congressional investigators have found.

The Government Accountability Office, in a report being released today, said the SEC's inspectors should have detected the market-timing abuses before September 2003, when regulators began an industrywide crackdown after New York Attorney General Eliot Spitzer exposed the violations.

Market timing of mutual funds, which involves rapid in-and-out trades, is not illegal but is prohibited by many funds because it can disadvantage ordinary shareholders. In many of the cases brought by Spitzer and the SEC, mutual fund companies allowed favored clients such as hedge funds to engage in market timing.

Daimler hopes to sell China-made cars in U.S.

DaimlerChrysler AG hopes to make compact cars in China for sale in the United States, a company executive said yesterday.

The company's China chief, Ruediger Grube, said the compact would be a "totally new" car and wouldn't affect production of current DaimlerChrysler, Jeep or Dodge vehicles in the United States.

Grube said China's low labor costs figured heavily in the decision.

Enron founder wins delay in separate bank-loan trial

Enron founder Kenneth L. Lay's trial on charges related to his personal banking will be held next year, a judge decided yesterday.

Lay is accused of lying to banks about his intention to use their loans to buy Enron stock on margin before the company crashed in December 2001. Prosecutors had wanted the trial to begin as early as next month. "The desire to try this case fairly outweighs expedition," said U.S. District Judge Sim Lake in Houston.

Lay said in court papers last week and repeated in court yesterday that he wanted Lake to hear and decide the banking case at the same time that jurors are deliberating the verdict of a larger fraud and conspiracy case pending against him, former Enron chief executive Jeffrey K. Skilling and former top accountant Richard A. Causey. That trial is slated to begin in January and is expected to last several months.

Korean chip-maker to admit fixing prices, pay fine

South Korean computer chip-maker Hynix Semiconductor Inc. has agreed to plead guilty to fixing prices and will pay a $185 million fine, the Justice Department said yesterday.

The government's three-year investigation of the largest makers of widely used computer memory chips - a $7.7 billion market in the United States - has resulted in more than $345 million in fines and guilty pleas from two companies and five individuals.

Scott Hammond, the head of criminal enforcement in the Justice Department's Antitrust Division, said the victims included some of the world's largest computer companies - Dell Inc., Hewlett-Packard Co., International Business Machines Corp. and Gateway Inc. - and consumers, who were forced to pay higher prices for computers and other electronics.

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