Wachovia seeks cash, will cut jobs
Wachovia Corp. is getting a lesson in “timing is everything.”
The nation’s fourth-largest bank reported a $393 million first quarter loss and has been forced to cut its dividend and seek a $7 billion cash injection to make up for a poorly timed expansion of its mortgage business.
The company also said it plans to cut 500 jobs in its corporate and investment bank.
Shares in Wachovia fell $2.72, or nearly 10 percent, to $25.09 on Monday.
It’s the second time this year the Charlotte, N.C.-based bank has gone to the well for cash, a move analysts say more banks large and small will do to brace themselves against further loan losses.
Last week, Seattle-based Washington Mutual Inc. said that a consortium of investors led by TPG would invest $7 billion into the struggling thrift.
“Wal-Mart Stores Inc. is moving closer to a possible expansion into Russia with the appointment of an experienced European executive to scope out possibilities in a vast retail market worth more than $140 billion a year in food sales alone.
The world’s largest retailer, which has been weighing a Russia move for some time, on Monday named German retailing veteran Stephan Fanderl as president of Wal-Mart Emerging Markets-East to “explore retail business opportunities in Russia and neighboring markets.”
Wal-Mart Chief Executive Lee Scott told analysts in October that Bentonville, Ark.-based Wal-Mart wants to open in Russia, although he did not provide a timeline.
“German automaker Volkswagen AG said Monday it sold 7 percent more vehicles in the first quarter than it had a year earlier to reach a new high, despite the dampening effect on exports of the strong euro.
Sales for the January-to-March period increased to 1.572 million vehicles — the company’s best quarterly sales figure ever, Volkswagen said. The Wolfsburg-based company is “on a good path to reach a new sales record for the whole year in 2008,” Volkswagen Group sales head Detlef Wittig said.
Europe’s biggest automaker by sales was helped by a strong performance in China, where sales rose 32 percent in the first quarter.