Citibank, others fail stress test
Citibank, others fail stress test
WASHINGTON (AP) — Four major U.S. banks failed to show they have enough capital to survive another serious downturn, the Federal Reserve said Tuesday. The list included Citigroup, the nation’s third-largest bank.
The Fed said 15 of the 19 major banks tested passed. The Fed noted that all 19 banks are in a much stronger position than immediately after the 2008 financial crisis.
Still, SunTrust, Ally Financial and MetLife joined Citi in failing to meet the test’s minimum capital requirements. The Fed reviewed the bank balance sheets to determine whether they could withstand a crisis that sends unemployment to 13 percent, causes stock prices to be cut in half and lowers home prices 21 percent from today’s levels.
Citi’s failure came as a shock. Analysts were expecting the bank to pass, especially after it reported two years of profits.
Some analysts expected the bank to be able to increase its dividend to 10 cents a share and even buy back stock. Citi’s stock fell 4 percent in the after-market.
‘Homeless 4G’ spots stir debate
AUSTIN, Texas (AP) — A charitable marketing program that paid homeless people to carry Wi-Fi signals at South By Southwest has drawn widespread debate at the annual Austin conference and around the country.
BBH Labs, a unit of the global marketing agency BBH, gave 13 people from Austin’s Front Steps Shelter mobile Wi-Fi devices and T-shirts that announced “I am a 4G Hotspot.”
The company paid them $20 up front and a minimum of $50 a day for about six hours work, said Emma Cookson, chairwoman of BBH New York. She called the experiment a modernized version of homeless selling street newspapers.
All of the money paid for Wi-Fi — an often difficult thing to find at SXSW — went to the participants, who were selected in partnership with Front Steps. ($2 was the recommended donation for 15 minutes of use.)
But many have called the program exploitive. Wired.com wrote that it “sounds like something out of a darkly satirical science-fiction dystopia.”
Doobie Brothers drummer dies
DUBOIS, Wyo. (AP) — Longtime Doobie Brothers drummer Michael Hossack, whose work is heard on the hits “Listen To The Music” and “China Grove,” died of cancer at age 65, his manager said Tuesday.
Hossack died Monday at his home in Dubois, Wyo., manager Bruce Cohn said. Hossack played with the group from 1971 to 1973 and rejoined in 1987. He stopped performing with the band two years ago while struggling with his health,
“Mike has always been a part of my musical life and the life of the Doobie Brothers,” said band co-founder Tom Johnston. “He was an incredible musician.”