Company news: Microsoft spins off creator of ‘Halo’

Microsoft Corp. said Friday it plans to spin off Bungie Studios, creators of the popular “Halo” video game trilogy, but keep a stake in the Kirkland-based company.

Microsoft said publishing agreements between the two for Microsoft-owned “Halo” intellectual property, and for future games developed by Bungie, will continue.

“Halo 3” launched Sept. 25. Gamers around the world have already plunked down more than $300 million for the game.

“While we are supporting Bungie’s desire to return to its independent roots, we will continue to invest in our ‘Halo’ entertainment property with Bungie and other partners, such as Peter Jackson, on a new interactive series set in the ‘Halo’ universe,” said Shane Kim, corporate vice president of Microsoft Game Studios, in a statement.

Washington Mutual Inc. said Friday that the weak housing market and the recent mortgage crunch will lead to a 75 percent drop in its third-quarter net income, making it the latest financial institution to warn investors it took a major hit over the summer.

WaMu, the nation’s largest savings bank, reported net income of $748 million in the third quarter of 2006, meaning third-quarter 2007 net income is likely to be somewhere around $187 million.

The decline in third-quarter income will mostly come from rising provisions for loan losses and write-downs of mortgages Washington Mutual currently holds.

Airbus Chief Executive Thomas Enders has denied allegations of insider trading stemming from the sale of shares in parent company EADS amid problems with the A380 superjumbo.

In a letter sent late Thursday to Airbus employees, Enders said that when he exercised stock options in November 2005, “there was no reason to believe it would be improper.”

A preliminary report by the French Financial Markets Authority, or AMF, suggests there was “massive insider trading” at European Aeronautic Defence & Space Co. The report, sent to Paris prosecutors, was based on a lengthy probe of share sales between November 2005 and March 2006 by 21 top managers.