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Business Briefs

Reported by Star-Bulletin staff & wire

Thursday, January 13, 2000

Bankoh setting up new chartered bank

Bank of Hawaii is setting up a new nationally chartered bank as a wholly-owned subsidiary in Phoenix, Ariz. to handle its credit-card operations.

The bank said national registration in a state that offers incentives to such businesses will give Bank of Hawaii the same flexibility and competitive edge as the nation's biggest credit-card companies, which all operate in such incentive states.

One example is "risk-based pricing," in which those who use cards responsibly will get fee advantages.

The new Bank of Hawaii National Association will be headed by Leilani Williams-Solomon, Bank of Hawaii's vice president for credit-card services. She said Hawaii customers will see no change. She said it may take most of the year to get the required approvals.

Microsoft promotes Ballmer to CEO

REDMOND, Wash. -- Microsoft Corp. Chairman Bill Gates today promoted President Steve Ballmer to chief executive, stepping aside from the day-to-day control over the world's largest software maker. Gates will remain chairman and take on the new title of chief software architect, saying he plans to dedicate his time working on developing new computer technology.

30-year mortgages increase to 8.18%

WASHINGTON -- Mortgage rates hit their highest level since April 1997 amid fears that the Federal Reserve will boost interest rates higher next month.

The average interest rate on 30-year fixed-rate mortgages climbed to 8.18 percent for the week ending Jan. 14, up from 8.15 percent last week, according to a weekly survey released today by Freddie Mac, the mortgage company.

Fifteen-year mortgages also were up this week with an average rate of 7.78 percent, compared with 7.73 percent last week. On one-year adjustable-rate mortgages, lenders were asking an average initial rate of 6.61 percent, up from 6.60 percent the previous week.

Schwab to acquire U.S. Trust Corp.

NEW YORK -- Charles Schwab Corp., the biggest Internet brokerage, agreed to buy money manager U.S. Trust Corp. for $2.7 billion in stock, extending its discount business to cater to wealthy individuals. U.S. Trust shareholders will get 3.427 shares of Schwab for each share of U.S. Trust, valuing them at $129 apiece, 63 percent more than its closing price yesterday.

In other news ...

CHICAGO -- UAL Corp.'s United Airlines warned that earnings will be below analyst forecasts in 2000 because of continued higher fuel expenses and rising labor costs.

SANTA CLARA, Calif. -- Applied Materials Inc., the No. 1 seller of equipment for making semiconductors, yesterday agreed to buy Etec Systems Inc. for about $1.78 billion in stock. Etec is the biggest maker of tools used to draw the circuit patterns that get transferred onto semiconductors.