Executives from about a dozen of the biggest U.S. commercial and investment banks are meeting Monday at the New York Federal Reserve to discuss ways to provide financial aid to South Korea.
Among the banks sending representatives are J.P. Morgan & Co., Chase Manhattan Corp., Citicorp, BankAmerica Corp., Bank of New York Co., Bankers Trust New York Corp., Goldman Sachs & Co., and Salomon Smith Barney Inc., a Fed official said.
William McDonough, president of the Federal Reserve Bank of New York, will be present, the official confirmed.
"It is our firm belief that a market-oriented private sector financing initiative offers the best solution to Korea's short-run liquidity concerns," the banks said in a statement.
The International Monetary Fund and the G-7 leading industrial nations Wednesday agreed to speed up aid to South Korea in an effort to stem its short-term foreign debt crisis and provide aid to reform its economy.
The Korean won is down about 43 percent against the dollar this year.
Calpers eyes taking board seats
SACRAMENTO, Calif. (AP) -- The California Public Employees' Retirement System, the nation's biggest pension fund, is drafting a new policy which would allow it to seek seats on boards of corporations in which it is a major stockholder.
But Calpers spokeswoman Patricia Macht said Friday that the $127 billion pension fund has no plans in the foreseeable future to seek or accept any board seats, and that the proposed policy doesn't target any specific companies.
Calpers in recent years has taken a more activist posture as an investor, seeking meetings with executives of what it considers underperforming firms and pressuring them to make changes to improve earnings or protect stockholder equity.
It pushed directors to replace the underperforming leaders of General Motors Corp., Eastman Kodak Co. and International Business Machines Corp., for instance. But Macht said there is no relationship between that more activist role as an investor and the new policy on holding board seats.
"Anyone who thinks this is a new weapon in our arsenal for corporate governance is going down the wrong track," she said.
Lomas trustee sues Ernst & Young
DALLAS (Bloomberg) -- Ernst & Young LLP and two of its audit partners are being sued by a Lomas Financial Corp. bankruptcy trustee for mismanaging the defunct mortgage company's audit and not properly disclosing the company's perilous financial situation.
Martin R. Pollner, the trustee representing the company's creditors and shareholders, is seeking at least $300 million in Dallas state court. The suit charges the accounting firm and the two partners with collaborating with management to conceal risky financial practices that contributed to the company's failure.
Lomas was once the largest mortgage company in the U.S.
Area stock index slips this week
The Buffalo Bloomberg Stock Index, an employee-weighted list of 58 companies with operations in Western New York, slipped 0.05 point, or 0.03 percent, to 183.19 this week. The index is up 36.91 percent so far this year.
Leading the index lower this week was Graham Corp., a Batavia-based maker of vacuum and heat transfer equipment. Its shares fell 2 7/8 to 14 1/8 . On Monday, Graham said it expects break-even results for the fiscal third quarter ending Dec. 31, compared with earnings of 35 cents a share in the year-ago period.
This week, the Buffalo Bloomberg Stock Index outperformed three major U.S. stock indexes.
For the week, the Standard & Poor's 500 Index fell 10.32, or 1.09 percent, to 936.46, while the Dow Jones industrial average declined 76.98, or 0.99 percent, to 7,679.31. The Nasdaq Composite Index fell 13.36, or 0.88 percent, to 1,511.38.
In other business news
Triangle Bancorp agreed to buy United Federal Savings Bank for $72 million in stock, as the bank expands in North Carolina. Triangle agreed to pay 0.63 shares for each United Federal share. That values United at $22.05 a share, a 30 percent premium over Wednesday's closing price and a 60 percent premium over Tuesday's closing price.
Dana Corp. said its plan to acquire Eaton Corp.'s axle and brake business for $287 million was approved by the Federal Trade Commission, paving the way for Dana to focus on certain types of heavy-truck parts.