plus 3, Economy prompts fresh look at ND's socialist bank - San Francisco Chronicle

Economy prompts fresh look at ND's socialist bank - San Francisco Chronicle

Posted: 16 Feb 2010 07:59 AM PST

Message from fivefilters.org: If you can, please donate to the full-text RSS service so we can continue developing it.

The Bank of North Dakota — the nation's only state-owned bank — might seem to be a relic. It was the brainchild of a failed flax farmer and one-time Socialist Party organizer during World War I.
But now officials in other states are wondering if it is helping North Dakota sail through the national recession.
Gubernatorial candidates in Florida and Oregon and a Washington state legislator are advocating the creation of state-owned banks in those states. A report prepared for a Vermont House committee last month said the idea had "considerable merit." Liberal filmmaker Michael Moore promotes the bank on his Web site.
"There's a lot of hurt out there, a lot of states that are in trouble, and they're tying the Bank of North Dakota together with this economic success that we're having right now," said the bank's president, Eric Hardmeyer.
Hardmeyer says he's gotten "tons" of inquiries about the bank's workings, including questions from officials in California, Michigan, New Mexico, Ohio and Washington state. North Dakota has the nation's lowest unemployment rate at 4.4 percent, soaring oil production and a robust state budget surplus — but Hardmeyer says the bank isn't responsible for the prosperity.
"We are a catalyst, perhaps, or maybe a part of it," he said. "To put this at our feet is flattering, but it frankly isn't true."
The Bank of North Dakota serves as an economic development agency and "banker's bank" that lessens the loan risks of private banks and helps them finance larger projects. It offers cheap loans to farmers, students and businesses.
The bank had almost $4 billion in assets and a $2.67 billion loan portfolio at the end of last year, according to its most recent quarterly financial report. It made $58.1 million in profits in 2009, setting a record for the sixth straight year. During the last decade, the bank funneled almost $300 million in profits to North Dakota's treasury.
The bank has the advantage of being the repository for most state funds, which can be used for loans and occasional relief for private banks that need a jolt of cash during sluggish credit markets.
"We think of ourselves as kind of a little mini-Federal Reserve," Hardmeyer said.
The state earns roughly 0.25 percent less interest than state agencies would get from a commercial institution. The bank also pays no state or federal taxes and has no deposit insurance; North Dakota taxpayers are on the hook for any losses.
The Bank of North Dakota was a cornerstone of the agenda of the Nonpartisan League, a farmers' political insurgency spawned by anger about outside control of North Dakota's credit and grain markets.
Founded in 1915 by A.C. Townley, who became a Socialist Party organizer after he went broke raising flax in western North Dakota, the NPL advocated state-owned banks to provide low-interest farm loans, along with state flour mills, grain elevators, meatpacking houses and hail insurance.
Supporters gained control of the legislature and the governorship within five years. The movement's power quickly waned, but two of its state-owned businesses survived — the Bank of North Dakota and a state flour mill and grain elevator in Grand Forks.
From the 1940s until the early 1960s, the bank served mostly as a public funds depository and municipal bond buyer, said Rozanne Enerson Junker, author of a 1989 history of the bank. Its economic development activity has greatly expanded since.
Gary Petersen, president of the Lakeside State Bank of New Town, a community on the Fort Berthold Indian Reservation in northwestern North Dakota, said the state bank is often willing to take a stake in local development projects.
"In my experience, you make a contact with the (Bank of North Dakota), and their question is, 'How do we get this done?'" Petersen said. "They're not looking at ways to knock it down."
Alerus Financial, a Grand Forks bank, has sold about $115 million of its $600 million loan portfolio to the Bank of North Dakota, both to spread its risk and provide itself with additional loan money, said Karl Bollingberg, Alerus' director of banking services.
"If you're left to find other participating banks, that can be very challenging," he said. "They don't have the same interest that the Bank of North Dakota has in helping you to do deals."
Mauro Guillen, a professor of management at the University of Pennsylvania's Wharton School of Business, said it is unlikely other states would open similar banks, in part because "the political culture here is very much against that kind of a thing."
Some state and federal agencies, such as the Small Business Administration, already have economic development programs similar to those at the Bank of North Dakota, Guillen said.
Bollingberg said the idea of other state-owned banks would also likely rouse opposition from private banks that wanted to keep their share of state deposits. "Because the (Bank of North Dakota) has been here so long, no banks know what it was like to have those deposits," he said.
Hardmeyer said he, too, was always doubtful others would take up North Dakota's model, but now he's not so sure.
"When I see what's going on around the country, it's not quite as far a leap as I thought it once was," he said.
___
On the Net:
Bank of North Dakota: www.banknd.nd.gov/

Five Filters featured article: Chilcot Inquiry. Available tools: PDF Newspaper, Full Text RSS, Term Extraction.

Upbeat corporate earnings lifted the markets to a higher open with the ... - Columbus Dispatch

Posted: 16 Feb 2010 07:45 AM PST

Message from fivefilters.org: If you can, please donate to the full-text RSS service so we can continue developing it.

Upbeat corporate earnings lifted the markets to a higher open with the Dow climbing 110 points to 10,209 while Nasdaq gained 21 points to 2205.

On the upside
Morgan Keegan upgraded Synovus Financial (SNV).
Terra Industries (TRA) agreed to be acquired by Yara for approximately $4.1 billion in cash to form the world's largest fertilizer producer.
Barclays (BCS) reported fourth quarter earnings that surged more than tenfold beating analyst expectations.
On the downside
PMI (PMI) disappointed with a much wider than expected loss for the fourth quarter.
Shares of Compellent Technologies (CML) continued to fall after reporting fourth quarter earnings that fell short of expectations last week.
General Cable (BGC) stock continued falling after swinging to a fourth quarter loss.
In the broad market, advancing issues outpaced decliners by a margin of 5 to 2 on the NYSE and by 9 to 7 on Nasdaq. The Russell 2000 which tracks small cap stocks rose 3 points to 613.

Five Filters featured article: Chilcot Inquiry. Available tools: PDF Newspaper, Full Text RSS, Term Extraction.

Daimler Seen Swinging To EUR277 Million 4Q Net Profit - NASDAQ

Posted: 16 Feb 2010 08:49 AM PST

Message from fivefilters.org: If you can, please donate to the full-text RSS service so we can continue developing it.

By Christoph Rauwald, Of DOW JONES NEWSWIRES

FRANKFURT -(Dow Jones)- Daimler AG (DAI) is expected Thursday to report a fourth-quarter net profit of EUR277 million as it recovers from a EUR1.53 billion loss in the same period of 2008 when a massive charge related to its former U.S. unit Chrysler LLC along with collapsing demand for luxury cars and trucks pushed the German automaker deep into the red.
Analysts will focus on the Stuttgart-based firm's full-year outlook, an update on cooperation talks about small cars and the projects Wolfgang Bernhard will be focussing on after the van chief takes his seat on Daimler's executive board.
Daimler's closely-watched earnings before interest and tax, or Ebit, is expected to come in at EUR489 million in the fourth quarter after a EUR1.95 billion loss in the prior-year period, according to a Dow Jones survey of 14 analysts.
Adjusted Ebit from ongoing operations--a metric that is closely watched by analysts covering Daimler--is expected to double to EUR594 million from EUR280 million, indicating that the anticipated earnings recovery is gaining traction. Daimler Chief Executive Dieter Zetsche had forecast a gradual earnings improvement in 2009 after a gloomy start to last year.
Fourth-quarter revenue is expected to decline 9.2% year-on-year to EUR21.1 billion from EUR23.2 billion.
Daimler's core Mercedes-Benz Cars division is poised to drive the company's recovery as demand for the high-margin E-Class model and the flagship S-Class sedan has been firming up in recent months. Improving sales momentum at Mercedes-Benz is expected to more than offset poor sales at the division's ultra-luxury Maybach name plate and the Smart minicar brand.
Analysts expect the division's Ebit to come in at EUR537 million after a EUR359 million loss in the fourth quarter 2008.
Daimler's truck unit, the world's largest truck maker by sales, is expected to report an Ebit loss of EUR201 million, reflecting the woes embroiling the truck industry, after eking out a EUR86 million profit in the prior year period. Demand for trucks contracted sharply in many major markets around the globe amid the economic downturn.
Analysts expect Daimler's financial services operations to post Ebit of EUR95 million, down 38% from EUR153 million in the fourth quarter 2008.
Most analysts currently favor luxury car makers such as Daimler and German rival BMW AG (BMW.XE) over mass-market manufacturers as they didn't benefit from state-backed scrapping incentives schemes rolled in many markets last year to revive demand. That demand is set to deteriorate sharply in Western Europe after the schemes are phased out, and Daimler and BMW are believed to have a significantly smaller exposure to the anticipated market downturn than their peers in the volume segment.
"Daimler remains our top pick since it ticks all boxes starting from exposure to corporate sales, product momentum, U.S. and (emerging markets) exposure," Credit Suisse said in a note, adding that "trucks should have reached their bottom in 2009".
"For the fourth quarter particularly, we expect a further recovery of the operating performance," BHF Bank Aleksey Wunrau said. He cautioned that the stock might still react negatively on the earnings release as the fact that some of the temporary cost savings will peter out in summer could cloud the outlook for the full year.
-By Christoph Rauwald, Dow Jones Newswires; +49 69 29 725 512; christoph.rauwald@dowjones.com

 (END) Dow Jones Newswires 02-16-101145ET Copyright (c) 2010 Dow Jones & Company, Inc.

Five Filters featured article: Chilcot Inquiry. Available tools: PDF Newspaper, Full Text RSS, Term Extraction.

Secova’s 2010 Business Outlook for HR Outsourcing - YAHOO!

Posted: 16 Feb 2010 06:26 AM PST

Message from fivefilters.org: If you can, please donate to the full-text RSS service so we can continue developing it.

Previous adopters of human resources outsourcing (HRO) services are making significant changes when restructuring their end-of-term contracts. According to the Everest Research Institute, the end of the term multi-process HRO market holds a great significance as $6 billion of contracts are nearing renewal in 2010 – 2012. What benefits administration initiatives are corporate HR currently investing in to reduce benefits costs and manage change?
Newport Beach, CA (PRWEB) February 16, 2010 -- Secova Inc., a leading provider of human resource and benefits management services, today announced its addition of forty nine (49) new business service agreements completed in 2009. Twenty-six (26) of the companies have signed on for benefits administration services, including enrollment, data management, premium billing and call center services, while the other twenty-three (23) clients are working with Secova to implement Dependent Eligibility Verification projects.
With the addition of these new clients, Secova continues demonstrating leadership in delivering valuable, effective benefits administration outsourcing services to clients in a variety of industries. The uncertainty presented from federal, state and local legislative arenas has led to organizations expanding and leveraging outsource providers as a means to keep pace with the rapid rate of change. In 2010, benefits administration outsourcing is being driven by the need for organizations to reduce HR transactional time and administrative costs, especially during a continued weak economy.
Previous adopters of human resources outsourcing (HRO) services are making significant changes when restructuring their end-of-term contracts. According to the Everest Research Institute, the end of the term multi-process HRO market holds a great significance as $6 billion of contracts are nearing renewal in 2010 – 2012. Businesses just now entering the HRO market are seeking the missing component that is critical to navigate through daily challenges brought on by gap analysis, change management and process improvement.
"Given the economic climate and the potential legislative changes, intensive benefits and administrative restructuring has been a comprehensive undertaking for corporate HR," said Joel Carter, Vice President New Business Development, Secova. "As the industry matures through the early part of the 21st century, Human Resource professionals have embraced the current call for HR transformation and are seeking new service delivery models that can deliver large productivity gains translating into a true competitive advantage."
Second generation HRO allows employers to redefine their strategies to reduce costs and improve performance by leveraging external intelligence and new technology. Manufacturing, banking, government, finance, healthcare and most of the direct-to-consumer businesses such as the retail trade are embracing these new processes that enable their businesses to better position themselves for both the near and long term. These industries see a need for significant change, from innovative business models down to new and emerging programs that lower expenses; such as seen through the Dependent Eligibility Verification.
"In today's economy, the mantra for most businesses is to keep costs low, and stay focused on their core competencies, "said Venkat Tadanki, Co-Founder and Chief Executive Officer of the company. " Keeping in mind, the clients' requirements, we have developed customized offerings which, through the year, helped our clients save up to as much as 10% on the total dollars spent on H&W ."
As the current economic climate forces organizations to explore tactics to stay competitive, it is apparent that the forecast for outsourcing is positive. Successful outsourcing is built on a foundation of value added support designed to unleash corporate HR savings. Ongoing quality, best practices and process improvements must be an essential component to todays successful outsourcing engagements. As corporate benefits administration is fueled by change, Secova is well positioned to better enable businesses to achieve their profitability goals and prepare for their current and near term growth objectives.
About Secova
Secova provides mid- to large- size companies offering a combination of services – from Benefits Enrollment and Administration to Absence Management and beyond – including Benefits Auditing, Benefit Plan Management, COBRA Administration, Employee Communications, HR Support Services and Payroll. Our "Best Shore" strategy allows us to shape each solution based on our clients' corporate goals and strategies, utilizing each of our locations to deliver the solution that provides the best value, both in quality and cost. All of the administrative functions can be available 24 hours a day, 7 days a week, as individual outsourced services or as total HRO/BPO processes. For more information, visit the company's website at www.secova.com.
This press release was distributed through PR Web by Human Resources Marketer (HR Marketer: www.HRmarketer.com) on behalf of the company listed above.
###
Secova
Sarah Soss
714-384-0590
E-mail Information
Trackback URL: http://prweb.com/pingpr.php/U3VtbS1Qcm9mLVNpbmctU2luZy1NYWduLVBpZ2ctWmVybw==

Five Filters featured article: Chilcot Inquiry. Available tools: PDF Newspaper, Full Text RSS, Term Extraction.