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George Stobbart

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Facing a grilling from angry lawmakers, Treasury Secretary Timothy Geithner on Wednesday defended his actions in the 2008 bailout of AIG and on the disclosure of payouts to major banks by the insurance giant.

Geithner, called to answer questions about his role in the bailout when he was president of the New York Federal Reserve, said the actions were aimed at financial stability and that authorities “did not act to help foreign banks.”

“Congress granted the Federal Reserve emergency authority precisely so that the government had some capacity to act to contain a systemic financial crisis,” he said in prepared testimony at the start of a stormy hearing.

“Not to have used that authority at that time would have been deeply irresponsible.”

Geithner also maintained that he was not involved in a decision to withhold information about AIG’s payouts that some have called a “backdoor bailout” of those firms including Goldman Sachs and a number of foreign banks.

“I had no role in making decisions regarding what to disclose about the specific financial terms of… payments to AIG’s counterparties,” he said.

Overall, Geithner offered an impassioned defense of the role of the central bank and other authorities to rescue AIG in the face of what appeared to be a financial system meltdown in September 2008.

“We did not act because AIG asked for assistance,” told the hearing of the House of Representatives’s Oversight and Government Reform Committee.

“We did not act to protect the financial interests of individual institutions. We did not act to help foreign banks. We acted because the consequences of AIG failing at that time, in those circumstances, would have been catastrophic for our economy and for American families and businesses.”

Lawmakers were not placated by Geithner’s remarks.

“I think our commitment to Goldman Sachs trumped the commitment to the American people,” said Representative Stephen Lynch, a Massachusetts Democrat.

“We’re not getting the whole story, we’re getting a lame story,” said Representative John Mica, a Republican from Florida.

Representative Darrell Issa said after the hearing that Geithner offered nothing to reassure lawmakers.

“It’s not conjecture, it’s not speculation, it’s fact, the New York Fed gave a backdoor bailout to AIG’s counterparties and then tried to cover it up,” Issa said.

Issa said Geithner did little to clarify the question of why AIG payments were not initially disclosed.

“If he didn’t know, he should have and no one has answered the question as to why the New York Fed were so adamant at keeping details of the counterparty deal confidential,” Issa said.

The Fed provided a loan of 85 billion dollars to AIG in September 2008 in what would be the first portion of a staggering bailout worth some 180 billion dollars.

Neil Barofksy, the special inspector general for the Troubled Asset Relief Program passed by Congress, told the panel meanwhile he had “initiated an investigation into whether there was any misconduct related to the disclosure or lack thereof” in the payouts.

The inspector general also said that while some of the US investments in AIG would be repaid with a profit, the government was likely to lose more than 30 billion dollars, based on Treasury estimates.

Barofsky also addressed the issue of assertions from the Fed that it had no ability to impose “haircuts,” or reductions, in the payouts of AIG contracts to big banks, including foreign institutions.

He said the New York Fed “made several policy decisions that severely limited its ability to obtain concessions.”

Only one bank, Swiss-based UBS, was willing to accept a reduction, and that was just a cut of two percent of the value, he said.

Barofsky added that France’s banking regulator “was open to further negotiations” in payments to Societe Generale and other French firms even though it had asserted that any reduction might violate French laws.

But he noted that the French agency had indicated that any reduction “would likely have required universal agreement among counterparties.”

Meanwhile former Treasury secretary Henry Paulson defended the actions to save AIG under his tenure.

“Had AIG failed I believe we would have seen a complete collapse of our financial system, and unemployment easily could have risen to the 25 percent level reached in the Great Depression,” Paulson said.

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    People should be allowed to extend their working lives into older age, said the equalities watchdog on Monday under proposals to scrap the current retirement age of 65.

    The Equality and Human Rights Commission said retirement law discriminates against people who want to continue working.

    Employers can currently force all staff to retire when they reach 65, regardless of their circumstances, although there are currently 1.3 million over 65s in the workforce.

    With the state pension age set to rise to 66 for both men and women in 2024, the EHRC said the law is outdated and called for employers to extend more flexible working hours.

    In a survey of 1,500 over 50s, the watchdog found a quarter of men and two thirds of women wanted to carry on working beyond the current state pension age.

    Although demand for flexible work is high, it found older employees were dissatisfied with the lower-level part-time work offered beyond 65.

    “Radical change is what older Britons are telling us needs to happen for them to stay in the workforce,” said Baroness Margaret Prosser, the commission’s deputy chairman.

    “Britain has experienced a skills exodus during the recession and as the economy recovers we face a very real threat of not having enough workers — a problem that is further exacerbated by the skills lost by many older workers being forced to retire at 65.”

    She added that recruiting and retaining older workers with more flexible hours “makes good business sense”.

    An estimated 15 billion pounds could be pumped into the economy by allowing employees to lengthen their working lives, according to the commission.

    The government has promised to review of the law.

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      Britain was on Tuesday expected to discover that its record recession officially ended in the fourth quarter of 2009 but the nation’s huge debt looks set to stunt recovery, economists said.

      The Office for National Statistics will publish data widely-expected to show that the economy grew by 0.4 percent during the final three months of last year following six quarters of negative figures.

      However, the good news about the economy may not be enough for Prime Minister Gordon Brown to keep his job after the looming general election, whose date has not yet been set but which must take place by June.

      The economy faces a bleak future with public borrowing forecast to hit a massive £178 billion in 2009/10.

      Despite a mountain of debt as a result of the multi-billion-pound bailout of the nation’s struggling banks, Brown has insisted that it was not the time to cut state aid.

      “If you withdraw the stimulus too quickly, then you risk a period when you put the recovery at risk. There is no doubt that that’s the view of the rest of the world. It is certainly my view,” Brown told a press conference on Monday.

      The future for the British and wider global economy is far from rosy, with the International Monetary Fund and the United Nations recently warning of a possible renewed or “double-dip” recession this year.

      Those worries have been heightened in Europe, where several nations — notably Greece and Portugal — are struggling to cope with soaring public debt.

      “The UK looks to have a weak recovery this year even as it is expected to have exited recession in the fourth quarter,” said Linda Yueh, an economics expert at Oxford University.

      “No current credible plan to reduce the fiscal deficit and the uncertainty associated with an upcoming general election could mean a growing risk premium on debt and the cost of servicing that could in turn dampen growth.

      “All in all, a ‘double dip’ is possible or a stagnant quarter in 2010,” Yueh told AFP.

      The state of the economy has become the key battle ground ahead of the general election that is likely to see Brown’s Labour Party defeated by the opposition Conservatives, according to polls.

      Whichever party wins power, Britain faces public spending cuts and taxation hikes in the years ahead as it looks to reduce state borrowing, economists say.

      The economy, which is also struggling with high unemployment caused by the financial crisis, contracted for six quarters in a row up until the final quarter of 2009 — its longest recession since records began in 1955.

      Chancellor Alistair Darling recently admitted that the recession would be deeper than thought — with the economy predicted to have shrunk 4.75 percent in 2009 compared with a prior official estimate of 3.5 percent.

      The economy is expected to grow by 1.0-1.5 percent in 2010, Darling added.

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      From more than 2,000 ideas submitted across the nation, Aviva Canada Inc today announced the eight winning entries for the first ever Aviva Community Fund – a unique competition designed to lead, empower and support positive change in communities across the country.

      Launched in October 2009, the heart of the Aviva Community Fund was centred around an online portal – www.avivacommunityfund.org – where Canadians were asked to submit ideas and vote for things that they would like to change at a local or national level. After several rounds of voting to identify Canada’s most popular causes, the Top 25 ideas were presented to an impartial panel of judges who evaluated the entries and inevitably made the tough decision of recommending which ideas would receive funding.

      Mirroring Canada’s cultural diversity and celebrating that no two communities are exactly the same, the Aviva Community Fund’s winning ideas come from as far East as Malpeque, Prince Edward Island, and as far West as Burnaby, British Columbia – making a total six stops in between.

      “The team at Aviva has been truly inspired by Canada’s passion for positive change, with communities proposing over 2,000 ideas and casting more than two million votes over the course of the competition,” said Maurice Tulloch, president and CEO, Aviva Canada. “The success of this program reinforces our commitment to leading positive change in both the insurance industry and in the communities where our customers, employees, brokers and partners live, work and play.”

      Aviva Canada congratulates the winners of the Aviva Community Fund:

      • Big Iieas (C$50,000 – C$250,000)
        • Building a lodge for Camp Triumph: Malpeque, PEI – Camp Triumph is an adventure camp for kids from families living with chronic illness. The Aviva Community Fund will enable this camp to build a lodge for indoor activities and therapy programs.
        • Make Our Dream A Reality: Burnaby, BC – A communal playground shared by several schools, including the BC School for the Deaf, is in dire need of a makeover. Funding from the Aviva Community Fund will enable this community to rebuild the playground with equipment suitable for children with special needs.
        • “Prison Yard” Playground: Brantford, ON – The Aviva Community Fund will enable the King George School to finish rebuilding playground structures, including an outdoor learning centre.
        • Scouting’s No One Left Behind: National – the No One Left Behind program was established in 2007 to ensure that financial barriers were not an issue for Canadian children interested in scouting. The funding from Aviva Canada will help the Scouts Canada Foundation provide girls and boys from low-income families the opportunity to belong to a group that teaches important life skills, self esteem and community service.
      • Medium ideas (C$10,000 – C$50,000)
        • Joe’s Place – Hungry for Hope: Moose Jaw, SK – Joe’s Place Youth centre provides guidance, support, and work skills training for at-risk youth. The funding from Aviva Canada will be used to build a kitchen for Joe’s Place as well as install equipment and update the youth centre’s social areas.
        • Noël vert pour tous: Montreal, PQ – the Consortium Evolution is a not-for-profit organization that develops innovative and environmentally friendly solutions. With the funding from Aviva Canada, Consortium Evolution plans to collect unused holiday toys from Quebec-based schools in an effort to conserve the valuable energy and resources that were consumed in their production.
      • Small ideas (up to C$10,000)
        • Charity Champs: Toronto, ON –Charity CHAMPS will build a new online community for Canadians aged 13-25 that nurtures and develops socially responsible attitudes in youth through microphilanthropy.
        • Théâtre Multimédia: Montreal, PQ – this unique arts program will provide 50 low-income schools within the Point-de-l’Ile School board, the opportunity to attend and participate in local theatrical arts initiatives.

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        US Treasury Secretary Timothy Geithner appears this week before lawmakers angry over his part in the bailout of insurance giant AIG, with concerns mounting over his role as the US administration’s top economic official.

        Some analysts say Geithner, who was conspicuously absent during President Barack Obama’s unveiling of tough proposals to regulate the banking system, may now be marginalized and could even be on his way out.

        “The first casualty of the president’s political debacle will likely be Timothy Geithner, the severely overconfident Treasury secretary well-known as a lapdog of Wall Street,” wrote the left-leaning journal The Nation.

        “Geithner was effectively repudiated by the president last week when Barack Obama abruptly announced a new, more aggressive approach to financial reform.

        But the immediate threat to Geithner is the scandal of collusion and possibly illegal behavior gathering around the Federal Reserve Bank of New York for its mega-billion-dollar takeover of insurance giant AIG.”

        On Wednesday, Geithner must answer questions before the House of Representatives Government Oversight Committee on his role — when he was president of the New York Federal Reserve — in the controversial AIG bailout.

        The congressional panel noted that internal AIG emails obtained by the committee to date “indicate that the (New York Fed) may have urged AIG to keep secret the details of the counterparty payments, despite the fact that taxpayer dollars made the payments possible.”

        The Fed provided a loan of 85 billion dollars to AIG in September 2008 in what would be the first portion of a staggering bailout worth some 180 billion dollars.

        Because AIG used the funds to reimburse banks holding the distressed mortgage securities, some have called the move a “backdoor bailout” of those firms including Goldman Sachs and a number of foreign banks.

        The details of the counterparty payments were initially kept secret but the recipients were disclosed in March 2009.

        The 22.4 billion dollars in payments were made to a number of firms.

        France’s Societe Generale, Germany’s Deutsche Bank and New York-based investment bank Goldman Sachs were the top three recipients.

        Fed chairman Ben Bernanke, who has also taken heat over AIG and his economic stewardship, has welcomed congressional efforts to look into the AIG bailout.

        The New York Fed has delivered 250,000 pages of records that were requested by the House committee.

        But with the political landscape shifting after a key Republican victory in a special Senate election last week, Geithner and Bernanke are now in the crosshairs of critics.

        John Hussman of Hussman Funds said it is time to replace both Bernanke and Geithner.

        “Since the beginning of the credit crisis, both of these bureaucrats have proven themselves to be ardent defenders of bank bondholders but a danger to the interests of the public,” Hussman wrote in a weekly commentary.

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        AXA today announced its intention to voluntarily delist its American Depositary Shares (“ADS”) from the New York Stock Exchange (“NYSE”) and to voluntarily deregister with the U.S. Securities and Exchange Commission (“SEC”).

        As a result, AXA intends to file a Form 25 with the NYSE during the first quarter of 2010 to effect the delisting. The delisting will be effective ten days after this filing. Following the effectiveness of the delisting from the NYSE, AXA intends to file a Form 15F with the SEC to deregister and terminate its reporting obligations under the Exchange Act. The Form 15F and deregistration will also relate to the following debt securities issued by AXA: 8.60% USD Subordinated Notes due December 15, 2030, 6.75% Euro Subordinated Notes due December 15, 2020 and 7.125% GBP Subordinated Notes Due December 15, 2020. The deregistration is expected to become effective within 90 days after the filing of the Form 15F.

        AXA’s delisting and deregistering will focus trading of its ordinary shares on AXA’s primary trading market (EuroNext Paris) which accounts for over 95% of worldwide trading volume. The delisting and deregistration will have no impact on the listing of AXA on Euronext Paris.

        AXA intends to maintain its US ADR program as a “level one” program which will permit AXA’s current ADR holders and other US investors to continue holding and trading AXA ADRs in the US over-the-counter market.

        Henri de Castries, Chairman of the Management Board of AXA, said, “The Group has derived a number of important benefits from its NYSE listing since 1996 including the financial reporting discipline we have achieved thanks to our Sarbanes 404 program and we intend to ensure that this discipline is maintained with an annual program to test the effectiveness of our internal controls going forward. Trading volumes and liquidity on the NYSE, however, have not developed to the level we had hoped when we initially listed. Since 1996, trading volume on the NYSE has represented a small portion of the Group’s global trading volume (currently less than 5%) and the market has not developed sufficient liquidity to be attractive for most institutional investors who continue to prefer the liquidity of our primary trading market on Euronext Paris. After considering all the pros and cons very carefully, we came to the conclusion that this decision is the right move for the Group at this stage in its evolution because the burdens of maintaining our listing and registration seem disproportionate to the benefits we have derived.”

        AXA will also continue to publish its annual reports and other financial communications in both English and French which will be available to US ADR holders and other investors through AXA’s website (www.axa.com).

        AXA’s decision to delist from the NYSE and deregister with the SEC does not call into question in any way the Group’s strategic vision for the US which has been one of the Group’s core markets for nearly 20 years and which will remain one of its core markets going forward.

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        Allianz Life Insurance Company of North America has appointed Ross Bowen as the vice president of profitability management.

        In his new role, Mr Bowen will be responsible for managing and monitoring the profitability of Allianz Life’s in-force block of business, collaborating with the company’s various financial functions to develop an integrated profitability management strategy.

        Prior to joining Allianz, he served as vice president of risk and value management for Phoenix Wealth Management in Hartford, Connecticut. He has also held vice president positions at Conning Asset Management in Hartford and Fortis Advisers in New York City.

        Neil McKay, Allianz Life’s chief actuary, said: “vice president of profitability management is an important role that will help Allianz Life maintain our strong financial health and promise to our customers. We’re thrilled to have Ross join the Allianz team and expand this function into a crucial part of our larger financial planning and analysis group.”

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          President Barack Obama vowed Saturday to “never stop fighting” for struggling Americans in a fiery counter-attack aimed at mending Democratic morale and his frayed bond with voters.

          Obama sought to recapture the passion of his 2008 campaign, after a wake-up call from voters in liberal Massachusetts who sent a Republican to the Senate, and with his health care plan and wider agenda under assault in Congress.

          “I’ll never stop fighting to make sure that the most powerful voice in Washington belongs to you,” he said in his weekly video and audio address, denouncing the Supreme Court’s decision to ease curbs on big business spending on election campaigns.

          He delivered the same promise on Friday during a town-hall style meeting in the rust-belt state of Ohio, a vital bellwether in mid-term elections in November shaping up as another hit for Democrats.

          Striking a populist tone, Obama said he would fight Wall Street to restore home values, to secure congressional passage for his embattled health plan, to stop credit card companies cheating customers and to cut “exploding” deficits.

          Five days before his showpiece State of the Union address, Obama also gave no sign of backing down on reforming health care, even as the historic bill looks to be becalmed in Congress.

          “I got to admit, we hit a bit of a buzz saw,” Obama said of the year-long effort to pass the reform, which now looks doubtful after Democrats lost their 60-seat Senate supermajority needed to thwart Republican blocking tactics.

          “I had no illusions when I took on health care. It was always going to be hard,” Obama said. “And I’m going to keep up the fight for real, meaningful health insurance reforms.”

          Posing as the champion of regular people, Obama added: “I can promise you, there will be more fights in the days ahead.”

          Obama critics, some of them Democrats, have faulted him for not being passionate enough in fighting economic blight, for siding too much with Wall Street and appearing aloof while everyday Americans struggle.

          But with his soaring approval ratings of just a year ago wilting, the president told a crowd in Ohio: “You know what, I win when you win.”

          “So long as I have the privilege of serving as your president, I’ll never stop fighting for you. I’ll take my lumps, too.”

          His day of rubbing shoulders with Ohioans in colleges, factories and a small town bar were designed to enhance the president’s “regular guy”

          credentials and to convince people he knows how tough things are.

          “The truth is, being president is also a little confining,” Obama said, explaining how he came to neglect his connection with Americans as he faced multiple crises in his first year in office.

          “I can’t just walk around and visit people like I used to. I can’t just go to the barber shop or sit at a diner.”

          Obama noted the political tumult following Democrats’ loss of a seat in Massachusetts, which deprived his party of the votes needed to skirt Republican challenges to pass major legislation.

          “The Democratic Party got a resounding wake-up call from the voters of Massachusetts,” David Plouffe, Obama’s former campaign manager, acknowledged in an op-ed to be published in The Washington Post on Sunday.

          “But it’s long been clear that 2010 would be a challenging election year for our party,” he added in the article accessible on the Post’s website.

          While lashing out against the financial industry, Obama also justified his highly unpopular decision to stick with the previous administration’s bank bailout plans.

          Had he not acted, he said, the country would have fallen into a second Great Depression, which would have taken a terrible future toll on ordinary Americans, or Main Street.

          Republicans boosted by this week’s victory of insurgent candidate Scott Brown in Massachusetts are cranking up their own populist rhetoric.

          “For the past year, Ohioans have watched anxiously as Washington Democrats, with the approval of President Obama, have pushed a job-killing agenda that includes a ‘stimulus’ that isn’t working,” said John Boehner, the top Republican in the House of Representatives who represents an Ohio district.

          Unemployment in Ohio is 10.6 percent, above the brutal national average of 10 percent.

          But the White House says Obama’s 787-billion-dollar economic stimulus plan has created 79,000 jobs in the state.

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            National Australia Bank (NAB) is a step closer to taking over AXA Asia Pacific Holdings Ltd. (AXA APH) after the bank’s examination of the wealth manager’s books found nothing to derail its A$13.3 billion proposal.

            NAB’s A$6.43-a-share all-cash bid–endorsed by the target’s independent directors over a rival proposal from AMP Ltd. –was subject to a number of conditions including that it completed satisfactory due diligence. NAB and AXA APH announced Friday that the due diligence has been completed.

            “There were no adverse findings,” said a NAB spokesman. “We remain committed to our proposal.”

            The proposal also requires that France’s AXA SA, which owns 53.9% of AXA APH, agrees to buy the unit’s Asian operations from NAB, leaving the Australian and New Zealand units to the local bank.

            However, AXA SA is locked in an exclusivity deal with its bidding partner AMP until Feb. 6, meaning it can’t begin discussions with NAB until then

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            Willis Group Holdings, the global insurance broker, announced today that it has extended the contract of its Chairman and CEO, Joseph J. Plumeri, until July 7, 2013. His previous agreement was set to expire on the date of the company’s annual meeting in April 2011.

            The company’s Board of Directors said: “Under Joe’s leadership, Willis has advanced its competitive position around the world and successfully navigated the strong headwinds of the continuing soft insurance market and the global economic downturn. Since joining in 2000, Joe has led the company through a decade of expansion through quality client service, a commitment to transparency, strategic acquisitions and sector-leading margins. We are delighted that Joe has agreed to stay at the helm to continue the company’s progress well into 2013.”

            Plumeri said: “The extraordinary story of how far Willis has come over ten years is a credit to the tireless efforts of our executive team and our nearly 20,000 Associates, the sound counsel of our Board of Directors and the continued support of our clients and shareholders. I am as proud of and as passionate about Willis as I’ve ever been and look forward to leading the company through its next stage of growth.”

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            Heath Lambert the insurance broker, has hired music specialist John Feaver from AXA to strengthen its expertise in the musical instrument insurance market.

            Feaver has ten years experience in the musical instrument business having previously worked both for Allianz and AXA Art insurance. Heath Lambert has the largest fine art team in Europe, and a prestigious list of clients. Feaver will be responsible for developing UK and European musical instrument business.

            Feaver said: “This is an exciting time for me to be joining such a well-established team, with a strong reputation in the musical instrument insurance marketplace both in the UK and around the world. Heath Lambert has devised comprehensive and competitive insurance solutions for a global market and I look forward to working with them.”

            Managing Director of Heath Lambert Art Jewellery and Private Client Division, Richard Northcott, added: “We are delighted to welcome John to the team. His proven expertise and experience in the highly specialised music sector and his wide range of contacts will be a valuable addition to our team, as we look to drive more business throughout 2010.”

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            Thousands of people who lost pensions when their employers went bust will get at least 90 per cent of their pensions guaranteed, as the final phase of the Financial  Assistance Scheme (FAS) regulations are put before Parliament.  The Government will pay out £3.5 billion to around 150,000 people.

            Minister of State for Pensions Angela Eagle said: “The Government is completing its promise to provide a just and final settlement for those who lost pension savings when their employers went bust.  There can be few greater cruelties than to find the pension you have earned has suddenly disappeared through no fault of your own.  That is why the Financial Assistance Scheme, which we are completing with these regulations, is so important to around 150,000 people.”

            Before the Pension Protection Fund (PPF) existed to help them, thousands of employees lost their savings between 1 January 1997 and 6 April 2005 when their defined benefit pension schemes were wound up without enough funds to pay their pensions.

            FAS payments have been extended to members of schemes that wound up under funded although their employer was still solvent, and those in ill health and unable to work will get early access to their pension.

            The FAS now provides help that is broadly similar to that provide by the PPF – at least 90% of the defined benefit pension accrued by individuals when their scheme began to wind up, which may be subject to a cap, paid from their normal retirement age.

            The £3.5 billion cost is being part funded by the Government absorbing assets remaining in the affected pension schemes.

            Responsibility for the administration of the FAS was transferred from the DWP to the Board of the PPF in July 2009, to establish a single organisation with responsibility for providing financial help to members of defined benefit pension schemes.

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              British bank Lloyds said on Thursday it intended to cut nearly 600 jobs in another shake-up at the state-rescued group that has already axed thousands of positions over the past year.

              “Lloyds Banking Group (LBG) is announcing today a number of changes within its wholesale and retail divisions,” it revealed in a statement.

              “In addition, some insurance work currently administered by a third party supplier based in the UK, will be brought back into the group and processed at its strategic Insurance centres in Bristol and Edinburgh.”

              LBG added: “There will be a net reduction of 585 permanent group jobs across the UK.”

              The company will shut its Black Horse personal finance centres, with the loss of 455 positions, while another 130 jobs will be axed in the retail division.

              Unite, Britain’s biggest trade union, slammed the fresh round of job cuts at the bank, which was bailed out by the state in the wake of the global financial crisis. The British taxpayer currently owns 43 percent of LBG.

              “Unite is deeply disappointed that the Lloyds Banking Group has taken the decision to close all of the Black Horse centres,” senior Unite official Rob MacGregor said in a separate statement.

              “At a time when many families are struggling to control their finances and businesses need access to credit, Unite is opposed to the shutting down of these valued local centres.”

              LBG, created in January 2009 when Lloyds TSB bought rival lender HBOS in a state-brokered deal, has already axed about 15,500 jobs since the start of 2009, according to the union.

              “Unite is warning the LBG not to repeat their approach in 2009, where staff faced death by a thousand cuts as weekly announcements of job losses were made,” MacGregor said.

              “The strategy last year has had a devastating effect on staff and created job insecurity for most colleagues,” he added.

              The union said it was seeking redeployment opportunities for those affected by the latest round of cuts.

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              Fitch Ratings has assigned a ‘BBB’ rating to Prudential Financial, Inc.’s recent issuance of $500 million of 2.75% three-year and $750 million of five-year 3.875% notes. The Rating Outlook is Stable. PRU’s other ratings are not affected by this rating action. See a complete list of ratings at the end of this release.

              PRU’s leverage remains within expectations for the current rating. Proceeds from the debt issuance are expected to be used for general corporate purposes.

              Fitch’s ratings on PRU and its subsidiaries continue to reflect its strong competitive position in the U.S. retail and institutional life and retirement markets. The company reported positive net flows and sales growth in 2009 despite the ongoing disruptions in the market. PRU also successfully closed on the sale of its minority stake in Wachovia Securities on Dec. 31, 2009. As expected, the sale generated a GAAP after-tax gain of approximately $1.5 billion and should increase PICA’s risk-based capital ratio by more than 100 points.

              On Dec. 21, 2009, Fitch affirmed PRU’s ratings and revised the Outlook to Stable from Negative. The Outlook revision reflects Fitch’s view that PRU has made considerable progress addressing prior concerns regarding the company’s capitalization, liquidity position, and overall financial flexibility. While Fitch continues to be concerned about PRU’s ongoing exposure to heightened investment losses, Fitch believes that the company is well positioned to address future expected investment losses and other contingencies over the medium term.

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                The Met Office has issued a weather warning for Central, Tayside & Fife and Grampian. Widespread icy roads and freezing rain are expected from 0001 Fri 22 Jan to 2359 Fri 22 Jan.

                There is a moderate risk of severe weather affecting parts of central Scotland today. Heavy rain will turn to snow over parts of central Scotland today, with local accumulations of 2 to 5cm above 100m, 5 to 10cm above 200m, and perhaps up to 25cm on ground over 300m.

                This will be accompanied by strong to gale force southerly winds in places, leading to some drifting of snow and blizzards on high ground.

                Widespread ice will affect many untreated roads and pavements inland following the overnight showers.

                The public are advised to take extra care and refer to Traffic Scotland for further advice on road conditions.

                To take action to prevent or protect your home or business against water damage from burst or frozen pipes you can find all you need to know about flood and natural disaster insurance below:

                Advice on coping with bad weather when driving

                Advice to motorists during ‘big freeze’

                Property owners at risk from serious water damage claims

                All you need to know about flood and natural disaster insurance

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                Aviva has won the 2009 Market Research Society Award in the Financial Services category, for its approach to generating insight which puts customer needs at the heart of the business.

                The research was commended for using cutting edge techniques which uncovered consumer views on the current economic climate whilst remaining focused on longer term needs and attitudes. By listening to customers and improving Aviva’s existing knowledge of UK consumers, the research enables Aviva to give consumers the products they want with messages they can easily understand.

                The Aviva project was selected from a shortlist of four companies as best demonstrating the value of research to Financial Services clients.

                David Barral, chief operating officer, at Aviva, said: “This is the largest single research project ever undertaken within Aviva’s UK Life and Pensions business, and its success means Aviva has increased its understanding of customer needs and attitudes, both financial and non-financial.

                “At Aviva it’s seen as a blueprint for change and to help us become the company that’s most recommended by customers, so I’m delighted that our innovative approach has been recognised by the Market Research Society.”

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                President Barack Obama’s top Democratic allies in the US Congress reeled Wednesday from a shock election defeat but vowed to pursue efforts to remake US health care, his top domestic priority.

                “First of all, we are not going to rush into anything,” Senate Democratic Majority Leader Harry Reid after Massachusetts voters elected a Republican to the chamber, ending the Democrats’ 60-vote supermajority.

                Reid said the Senate would not act until senator-elect Scott Brown, who rode to victory on a wave of voter anger in painful economic times, was sworn in, giving Republicans 41 Senate seats and the ability to stall legislation.

                But “in the coming year, we will ensure all Americans can access affordable health care, deny insurance companies the ability to deny health care to the sick, and slash our deficit in the process,” said the top Senate Democrat.

                Republicans said Massachusetts voters, by giving a Republican the seat once held by the late Democratic lion Ted Kennedy, had sent the unmistakeable message that the overhaul should die.

                “The people of Massachusetts had an opportunity to speak yesterday and they spoke rather loudly that they’d like to see the Congress go in a different direction,” said Senate Republican Minority Leader Mitch McConnell.

                Asked whether the Democratic health legislation was dead, McConnell replied: “I sure hope so.”

                The vote crippled Democratic plans to meld rival Senate and House versions of the historic overhaul, which aims to give health coverage to tens of millions of Americans who currently lack it, and pass a compromise bill.

                Senate Democrats emerged from their weekly policy luncheons saying they needed to take stock of their shrinking legislative options now that Republicans have the votes to block Obama’s proposal.

                “To me, the option that is a non-starter from the get-go is the option of doing nothing about the status quo,” said Democratic Senator Tom Carper.

                “What we need to do right now is just take a deep breath, not rush to judgment, take a deep breath, consider the options that are before us,” he told reporters.

                “Let’s take a breath and seriously consider a number of options. I think it does make some sense to take a few days to arrive at a decision. Now, we’re not taking about weeks. We’ve got days,” agreed Democratic Senator Bob Casey.

                Democratic Senator Paul Kirk, Kennedy’s temporary replacement, said the Massachusetts election reflected voter anger at the lack of progress towards creating jobs, but denied it was a referendum on health care.

                “I certainly didn’t take away from it, and I don’t think anybody in the caucus took away from it, that this is a reason to not go forward on health care,” he said.

                Democrats were considering a range of options to achieve what their closed-door talks now could not: Get a health care overhaul bill to Obama’s desk before the November mid-term elections

                One option may be for the House of Representatives to swallow its massive objections and endorse the Senate version of the bill — but it is far from clear Democrats have the votes for that option.

                Democrats could try to modify that bill later using a parliamentary procedure that requires a simple majority.

                “Heeding the particular concerns of the voters of Massachusetts last night, we heard the people and hopefully we will move forward with their considerations in mind,” said Democratic House Speaker Nancy Pelosi.

                “But we will move forward,” she said.

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                A new mobile application is set to keep Britain’s motorists moving and enable them to plan their route with the benefit of real time traffic information.

                The app, the first by RAC, is progressive amongst traffic apps as it shows start and end points of congestion, overlayed onto Google Maps. The app pinpoints the user’s exact location, meaning an immediate view of regional traffic is easily at hand. Text and audio summaries of traffic conditions are also available.

                This level of detail will give motorists the most precise and accurate view of live traffic conditions on the UK’s roads that is currently available on a mobile phone app. RAC’s app utilises up-to-the-minute traffic updates from Trafficlink, the UK’s leading provider of real-time traffic information.

                The app is free to download, and is available for both iPhone and Google Android phones. Motorists can download the app at the iTunes App Store and Android Market.

                RAC has a strong heritage in helping motorists plan their motoring journeys. Its Route Planner and Traffic and Travel News tools on its website, www.rac.co.uk, receive over two million unique visitors every month.

                Saj Arshad, director of RAC sales and marketing, said: “RAC’s first app is a natural companion for motorists who frequently feel thwarted by the growing problem of congestion on the UK’s roads.

                “Given the popularity of our Route Planner online, we know motorists trust RAC when it comes to all things motoring. We’re delighted to build on this legacy with a free app to help motorists plan their journeys using live traffic information.

                “It’s already proving popular, too. Within hours of launching the app on Android Market, we saw a download rate of more than one a minute, and notched up a couple of five star ratings. Watch this space for more developments – for both apps and online.”

                For more information on RAC’s mobile traffic app and to download the app for free, please visit the iTunes App Store or Android Market.

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                  The Financial Services Authority (FSA) has today fined Standard Life Assurance Limited (SLAL) £2.45m for serious systems and controls failings that resulted in the production of misleading marketing material for its Pension Sterling Fund (the Fund). There were approximately 98,000 retail consumers invested in the Fund as at 23 December 2008.

                  The FSA found that between 10 July 2006 and 28 February 2009, SLAL failed to ensure that there were proper systems and controls over the Fund, specifically in relation to the marketing material produced. This resulted in a risk of unexpected capital losses being incurred for those customers invested in the Fund. The FSA also found that there had been a lack of prompt and full investigation of concerns that arose about that marketing material.

                  The FSA investigation concluded that:

                  • marketing material regarding the Fund was not ‘clear, fair and not misleading’;
                  • despite the majority of the Fund being invested in Floating Rate Notes by July 2007, marketing material issued by SLAL referred to the Fund as being wholly invested in cash;
                  • there were no adequate systems or controls in place to ensure that marketing material issued accurately reflected the investment strategy for the Fund;
                  • customers were therefore misled as to the true nature of the investments held by the Fund and as a result, they were given misleading information on the risk of capital losses; and
                  • as the Fund was intended primarily for the investment of pensions it was considered appropriate for individuals approaching retirement and as such, the capital risk associated with an investment was of great importance.

                  The risk of unexpected consumer losses was demonstrated by the reduction in value of the Fund by 4.8% (approximately £100m) on 14 January 2009. SLAL proactively paid a total of £102.7m into the Fund to restore the value of the investors’ holdings to the position they would have been in prior to the fall in the unit price.

                  In addition to this capital injection, SLAL has proactively contacted existing customers identified as having received poorer quality marketing material in order to determine whether any further compensation may be required in their individual cases. SLAL also took proactive steps to address the situation, commissioning a report by an independent third party into the systems and controls relating to the marketing material issued in respect of the Fund, and improving these systems and controls in relation to the Fund.

                  Margaret Cole, FSA director of enforcement and financial crime, said: “The FSA takes the issue of misleading financial promotions very seriously and the fine announced today demonstrates our commitment to the principle of credible deterrence. It is critical that consumers are given an accurate understanding of the nature of investment products and the risks involved. Without this information, consumers are unable to make informed decisions about whether investments are suitable for their individual investment strategy. Throughout 2010 and beyond, the FSA will continue to take strong action when a firm’s financial promotions fall short of the requirement to be ‘clear, fair and not misleading’ and customers have not been treated fairly.

                  “The failures at SLAL arose because there were inadequate systems or controls in place to ensure that marketing material issued accurately reflected the investment strategy for the Fund. There were also inadequate processes in place to enable effective communication between business areas and committees resulting in a lack of awareness of any divergence between the marketing material and investments held by the Fund.”

                  Standard Life Assurance Limited cooperated fully with the FSA and agreed to settle at an early stage of the FSA’s investigation, therefore qualifying for a 30% reduction in penalty. Were it not for this discount, the FSA would have imposed a financial penalty of £3.5m.

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