Airline's stock falls on bankruptcy comment
DALLAS - American Airlines' stock took another hit Monday, falling 14 percent after the union representing flight attendants warned that the carrier might file for bankruptcy "sooner rather than later."
The president of the Association of Professional Flight Attendants said union leaders expect to negotiate a concessions package to be voted on by the membership.
American's parent, AMR Corp., raised the possibility that it might seek protection from creditors last month when it asked employees for $1.8 billion in annual wage and other concessions as part of $4 billion in planned annual cost cuts.
Shares of AMR fell 40 cents, or 14 percent, to close at $2.41 each Monday on the New York Stock Exchange.
American said it would not comment on the timing of a possible bankruptcy filing.
Some investors got advance warning
RICHMOND, Va. - Capital One Financial Corp. gave advance notice to some of its lenders and advisers that its chief financial officer planned to resign amid an insider trading probe.
The McLean, Va.-based consumer credit company said in a prepared statement Monday that it had discussions with some of its "lenders under its corporate credit facility, advisers, rating agencies and regulators shortly before the public announcement" last week of the probe and the resignation of finance chief David Willey.
On March 3, the day the announcement was made, Capital One's stock fell $2.72 a share, or 8.8 percent, to close at $28.25 a share.
Rates fall in Monday's Treasury bill auction
WASHINGTON - Interest rates on short-term Treasury securities fell in Monday's auction, with rates on six-month bills dropping to their lowest level on record.
The Treasury Department sold $17 billion in three-month bills at a discount rate of 1.055 percent, down from 1.175 percent last week. An additional $17 billion was sold in six-month bills at a rate of 1.030 percent, down from 1.170 percent.
The three-month rate was the lowest since July 28, 1958, when the bills sold for 0.984 percent. The six-month rate was the lowest since the government began selling those bills on a regular basis in 1958.
Fannie Mae says it has assets to handle crisis
WASHINGTON - Fannie Mae shrugged off charges Monday that it lacks capital to weather disruption to financial markets, saying its standards allow it to endure "the most difficult stress scenarios faced by our nation over the last century."
Fannie Mae said no other company in the United States faces more stringent requirements for maintaining its soundness than it does.
Earlier Monday, St. Louis Federal Reserve President William Poole told federal regulators with oversight of Fannie Mae and Freddie Mac, which together control 42 percent of all U.S. home mortgages, that their combined size is big enough to threaten the economy.
Poole was speaking at a housing symposium hosted by the Office of Federal Housing Enterprise Oversight. He called on regulators to gradually increase the capital requirements for Fannie and Freddie to avoid a "calamity."
Former paper company executives charged
NEW YORK - Federal authorities Monday announced criminal charges against former top executives of American Tissue Inc., once one of the nation's biggest makers of paper tissue, saying the company lied and cheated to keep up the facade of profitability.
Mehdi Gabayzadeh, the former chief executive officer and part owner of American Tissue, was among four ex-executives accused in court papers of swindling banks, financial institutions and investors of nearly $300 million.
A former employee of the public accounting firm Arthur Andersen LLP also was arrested for allegedly destroying American Tissue accounting documents.
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