Business news in brief

— QUOTE OF THE DAY “We are very sorry to have caused passengers and their family members so much concern.” Osamu Shinobe, All Nippon Airways senior executive vice president, on the grounding of the airline’s 787 fleet Article, 1D

$557 million settles foreclosure cases

WASHINGTON - Goldman Sachs and Morgan Stanley will pay a combined $557 million to settle federal complaints that they wrongfully foreclosed on homeowners who should have been allowed to stay in their homes.

The agreements announced Wednesday with the Federal Reserve were similar to deals struck earlier this month with 10 other major banks and mortgage lenders. Combined, the 12 firms will pay more than $9 billion.

Goldman will pay $330 million. Morgan Stanley is paying $227 million.

The settlements could compensate hundreds of thousands of Americans whose homes were seized because of abuses such as “robo-signing,” when banks automatically signed off on foreclosures without properly reviewing documents.

The agreement will also help eliminate huge potential liabilities for the banks.

Consumer advocates say regulators settled for too low a price by letting banks avoid full responsibility for foreclosures that victimized families.

  • The Associated Press

Wendy’s fourth quarter beats forecasts

DUBLIN, Ohio - Wendy’s new value menu and focus on premium burgers helped its fiscal fourth-quarter net income top Wall Street expectations, the hamburger chain said Wednesday.

Results show Wendy’s push to position itself on the higher end of the fast-food pecking order in terms of quality seems to have gained some traction. Wendy’s has also begun revamping restaurants with a modern look with causal seating areas more reminiscent of chains such as Panera Bread Co.

Wendy’s net income jumped to $22.4 million, or 6 cents per share, for the three months ended Dec. 30.

That’s up sharply from $4 million, or 1 cent per share, a year earlier. The current quarter’s results included a tax benefit, lower interest expense and a sharp rise in investment income.

Removing impairment charges, facility relocation costs and other items, adjusted earnings were 8 cents per share.

Revenue increased 2 percent to $629.9 million from $615 million.

Analysts surveyed by FactSet expected adjusted earnings of 4 cents per share on revenue of $637 million.

For the full year, Wendy’s reported earnings from continuing operations of 1 cent per share. Adjusted earnings were 16 cents per share. Revenue rose 3 percent to $2.51 billion.

Wendy’s shares rose 18 cents, or 3.7 percent, to close at $5.08.

  • The Associated PressHomebuilder confidence holds steady

LOS ANGELES - Confidence among U.S. homebuilders held steady in January at the highest level in nearly seven years.

The National Association of Home Builders/Wells Fargo builder sentiment index released Wednesday held at 47, the same as in December and the highest reading since April 2006, just before the housing bubble burst.

Readings below 50 suggest negative sentiment about the housing market. The last time the index was at that level or higher was in April 2006 when the reading was 51. It began trending higher in October 2011, when it stood at 17.

The latest index, which is based on responses from 402 builders, comes at a time of improving fortunes for homebuilders, many of which have seen sales improve over the past year amid the best market for newly built homes since the housing boom.

Stable job gains, record-low mortgage rates and a tight supply of new and previously owned homes available for sale have helped fuel home sales and drive prices higher, albeit from very low levels.

Business, Pages 26 on 01/17/2013

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