Business Briefs

Reported by Star-Bulletin staff & wire

Thursday, June 19, 1997

Thirty-year mortgages
fall to 7.61% this week

WASHINGTON -- Thirty-year, fixed-rate mortgages averaged 7.61 percent this week, down from 7.72 percent last week, according to a national survey released today by the Federal Home Loan Mortgage Corp.

It was the lowest since February 20, when rates averaged 7.56 percent. Rates have been falling since reaching 8.18 percent during the week ended April 3.

On one-year adjustable rate mortgages, lenders were asking an average initial rate of 5.66 percent, down from 5.67 percent last week. Fifteen-year mortgages, a popular option for those refinancing mortgages, averaged 7.14 percent this week, down from 7.27 percent a week earlier.

The rates do not include add-on fees known as points.

Mahalo Air expanding
service to Maui, Kauai

Mahalo Air said it will expand its service between Honolulu and Kahului to 20 round-trip flights a day from 14 currently starting July 15.

The "on-the-hour" service will start from Honolulu at 6 a.m. each day and end with a flight from Kahului that arrives in Honolulu at 8:40 p.m. Mahalo has also added a 6:30 a.m. daily flight from Honolulu to Lihue, more than an hour earlier than its previous earliest flight. The new schedule calls for 102 flights a day, up from 84. The airline said it has a heavy passenger load in the summer.

Deal merges two sellers
of Hawaii tour packages

Sunquest Holdings, a Simi Valley, Calif.-based tour wholesaler, has bought another California tour company SunTrips for $20 million.

By next year the combined companies will surpass Pleasant Hawaii Holidays in the number of passengers to Hawaii, according to Sunquest Vice President Lauren Southam. Sunquest's Sunquest Holidays operates primarily in Southern California, while San Jose-based SunTrips mostly markets in Northern California and the Pacific Northwest.

Sunquest Holidays has six flights a week to Hawaii from Los Angeles. SunTrips offers daily flights to Hawaii from San Francisco.

Unlike the two wholesalers, Pleasant Hawaiian Holidays books it tours on regularly scheduled airlines, rather than charter flights.

AES to invest $98 million
in China power plant

ARLINGTON, Va. -- AES Corp. says it will invest $98 million in Yangcheng International Power Co., a joint venture to build, own and operate a coal-fired power plant in China's Shanxi Province.

AES, an international electric company, will be a 25 percent partner of the $1.6 billion venture through its AES China Generating Co. subsidiary, which will oversee plant construction and operations.

AES, based in Arlington, Va., and the owner of a coal-burning power plant at Barbers Point, yesterday said the plant will be China's largest thermal power plant. The power will be sent via transmission line to the rapidly growing Jiangsu province.

Merrill Lynch to pay
to avoid criminal charges

SANTA ANA, Calif. -- Merrill Lynch & Co. will pay $30 million to end a criminal probe into the brokerage firm's role in the 1994 Orange County bankruptcy.

The company did not admit wrongdoing under the deal with the Orange County district attorney's office that was announced today. The agreement will not affect the county's $2 billion civil damage lawsuit against Merrill.

Under the agreement, the nation's largest investment house will pay $27 million to Orange County and will reimburse the county and the state $3 million for the investigation by the district attorney's office.

The county claimed Merrill Lynch set former county Treasurer Robert L. Citron on an investment strategy so risky that it was illegal on its face.

Merrill Lynch has denied wrongdoing, saying it warned Citron repeatedly of the risks and the financial disaster was of his own making.

Citron pleaded guilty to securities fraud and misappropriation of funds in April 1995. He was sentenced to a year in county jail and ordered to pay a $100,000 fine.