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POSTED: Friday, November 13, 2009

Mortgage rates stay below 5%

WASHINGTON >> Rates this week for 30-year home loans stayed below 5 percent for the second week in a row.

The average rate fell to 4.91 percent from 4.98 percent a week earlier, mortgage company Freddie Mac said yesterday.

The Federal Reserve has pumped $1.25 trillion into mortgage-backed securities to try to lower rates on mortgages and loosen credit. Rates on 30-year mortgages traditionally track yields on long-term government debt.

The average rate on a 15-year fixed-rate mortgage fell to 4.36 percent from 4.40 percent recorded last week. Rates on one-year, adjustable-rate mortgages declined to 4.46 percent from 4.47 percent.

New jobless claims drop

First-time claims for jobless benefits dropped last week to a seasonally adjusted 502,000, the Labor Department said yesterday. That's the fewest claims since the week ending Jan. 3. Claims would have to fall to the high 400s to indicate the economy could soon produce even a slight gain in jobs, estimates Abiel Reinhart, an economist at JPMorgan Chase.

Tourism agency boosts marketing

The Hawaii Tourism Authority marketing committee will spend more than $1.2 million from its marketing opportunity fund to shore up travel to Hawaii.

The money, which comes out of a $10 million fund created in June, will be used to stimulate travel from China, South Korea and Japan and to promote Hawaiian music around the world.

“;These four programs are prime examples of opportunities that arose in the marketplace that could be immediately secured through our marketing opportunity fund,”; said Mike McCartney, HTA's president and chief executive officer. “;I'm confident that they offer direct benefits to our visitor industry.”;

The largest chunk of money, $448,000, will go to support the Shanghai Expo, which is expected to attract more than 70 million people between May and October.

Japan Airlines will get $400,000 to encourage neighbor island expansion and the addition of seasonal charter flights. Likewise, South Korea's business and incentive travel market will get $240,000 to help boost travel.

The Na Hoko o Hawaii Music Festival, which debuts May 26-30, will get $150,000 to use Hawaiian music to stimulate travel.

To date, the HTA has spent $8.74 million of its marketing opportunity fund.

HawTel bankruptcy hearing near end

A weeklong hearing on the Hawaiian Telcom case is expected to wrap up in U.S. Bankruptcy Court today.

One final witness will testify, then attorneys will conclude their arguments before Judge Lloyd King.

HawTel, the state's largest telecommunications provider, filed for bankruptcy in December and is hoping to emerge from bankruptcy by obtaining confirmation of its reorganization plan.

The plan is opposed primarily by the committee of unsecured creditors, who allege that HawTel undervalued its company's assets, thereby undercutting their share of payouts.

Banks to prepay $45B in insurance

WASHINGTON >> U.S. banks will prepay about $45 billion in premiums to replenish a federal deposit insurance fund now in the red, under a plan adopted yesterday by federal regulators.

The Federal Deposit Insurance Corp. board voted to mandate the early payments of premiums for 2010 through 2012. Amid the struggling economy and rising loan defaults, 120 banks have failed so far this year, costing the insurance fund more than $28 billion.

To address the concerns of small banks in weak financial condition, the FDIC also set up an exemption process for those that prove the prepaid fees would be a hardship.

The FDIC expects the cost of bank failures to grow to about $100 billion through the next four years.

It is the first time the agency has required prepaid insurance fees. The idea behind it is for banks to spread the costs over three years rather than paying a one-time fee that would deplete their capital reserves.

Unlike a one-time fee, the prepaid premiums won't affect banks' earnings “;during these difficult times,”; FDIC Chairman Sheila Bair said before the vote.

ON THE MOVE

                       
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Bank of Hawaii has announced the following promotions:

>> Toby Martyn is senior executive vice president and will assume responsibility for client relationships, focusing on labor organizations and state and local government sectors. He was previously a chief investment officer.

>> Stephen K. Rodgers is senior vice president and will assume the role of chief investment officer. He was previously a portfolio manager for the bank's own investment portfolio.

>> Dean Akimseu to vice president from assistant vice president of corporate compliance. He was previously an internal auditor and compliance analyst for American Savings Bank.

>> Mark Bolian to vice president and automobile finance manager from assistant vice president. He was previously an assistant manager of the Dealer Center at City Bank.