Business & Finance
Citigroup agreed to buy Washington Mutual's consumer- finance subsidiary for $1.25 billion Monday. Washington Mutual Finance is based in Tampa, Fla., and employs 2,400 people in 25 Southern states. The purchase is part of a rapid expansion to Citigroup's consumer-lending operations, which accounted for 53 percent of net revenues for the first half of the year.
Among other developments in the financial industry:
• Independence Community Bank Corp. was set to announce a deal to buy Staten Island Bancorp for $1.4 billion in stock and cash, The Wall Street Journal reported.
• The Bank of New York announced the signing of a definitive agreement for Fifth Third Bank's corporate-trust unit, but declined to disclose terms of the transaction. Fifth Third Bancorp is based in Cincinnati.
• Security Trust Co. was expected to face securities fraud charges from federal and state regulators in New York, in the latest action over alleged improper mutual-fund trades. In a related move, the Treasury Department's Office of the Comptroller of Currency reportedly planned to file papers to force the Phoenix-based financial-services firm out of business by early next year.
Boeing Co. fired its chief financial officer (CFO) and a senior manager in its missile-defense unit for "behavior that runs counter to our high ethical standards." A letter to employees by chairman Phil Condit said the company had "compelling evidence" that CFO Michael Sears and Darleen Druyun "attempted to conceal" that they'd discussed the possibility of her joining Boeing while she still held an influential post in the Defense Department. In that capacity, she was deeply involved in negotiating lucrative contracts with the aerospace giant. She is being investigated separately by the federal government for possibly providing Boeing with sensitive information on bids by rival contractor Airbus Industrie. Druyun, whose daughter and son-in-law also work for Boeing, was hired by the company last January. Sears was considered a potential successor to Condit as Boeing's chief executive.
Another 2,000 employees will be laid off by Sprint Corp. between now and Dec. 31, the company said. The job cuts, which come on top of hundreds of others announced in mid-September, will affect employees in both the landline and wireless divisions as Sprint prepares to implement a restructuring plan at the start of the new year.