The government will give U.S. banks more time to increase their capital cushions against losses, delaying the requirement after financial industry criticized the start date. The Federal Reserve, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency say they will not make the requirement take effect on Jan. 1. They did not announce a new date. Instead, they said they will work on finalizing the rules. Regulators had proposed the Jan. 1 date in June. Afterward, financial industry officials complained that would not leave them enough time to comply. Stricter capital requirements were mandated as part of the 2010 financial overhaul. All U.S. banks are expected to hold capital worth at least 7 percent of their assets, up from a current minimum of 2 percent.
Chrysler recalls SUVs for possible airbag malfunctions
Chrysler is recalling more than 919,000 older-model Jeep Grand Cherokee and Liberty SUVs worldwide because the air bags can inflate while people are driving them. The recall affects Grand Cherokees from the 2002 through 2004 model years and Libertys from model years 2002 and 2003, according to documents posted Friday on the U.S. National Highway Traffic Safety Administration website. The safety agency said that a part can fail in the air bag control computer, and the front and side air bags can inflate while the SUVs are being driven. An agency investigation started last year found that the air bags went off 215 times, causing 81 minor injuries. No crashes were reported, but NHTSA said the problem could cause a wreck. Chrysler will install an electrical filter free of charge to fix the problem. The company will begin notifying owners of the recall in January. Dashboard warning lights normally come on before the air bags are inflated, Chrysler spokesman Eric Mayne said. The problem happens in less than three-hundredths of a percent of the vehicles on the road, Mayne said.
Britain investigates money laundering allegations
Britain’s revenue and customs service says it is examining allegations that criminals may have used offshore accounts with HSBC, Europe’s biggest bank, to launder money. Her Majesty’s Revenue and Customs said Friday that it had received data related to the allegations and was studying it. In a report, the Daily Telegraph newspaper alleged that a list disclosed by a whistleblower had shown drug dealers and other criminals were using accounts based in Jersey. It said the list identified 4,388 people holding 699 million pounds (or $438 million) in offshore current accounts. Jersey, a British dependency off the coast of France which has its own currency and tax laws, is a major offshore financial center. HSBC said it was also investigating the allegations and the purported loss of client data in Jersey.
J.C. Penney reports more losses
J.C. Penney Co. is hoping it has hit rock bottom. The bad news keeps getting worse for the struggling department-store chain that on Friday reported a wider third-quarter loss than Wall Street expected on a nearly 27-percent drop in revenue. That marks the third consecutive quarter of big losses and sales declines as customers continue to show that they’re unhappy with Penney’s decision this year to ditch hundreds of coupons and annual sales in favor of everyday low pricing. Penney’s new CEO Ron Johnson has been working to change everything at Penney’s.
The Associated Press contributed.