NATIONAL BRIEFING

Tuesday, November 4, 2008

STOCK

KKR Delays Plan to Go Public

Kohlberg Kravis Roberts, a private-equity firm, said its plan to go public would not be completed this year as scheduled because the Securities and Exchange Commission was still reviewing the deal. In July, KKR struck a deal to go public on the New York Stock Exchange through a takeover of an investment fund listed in Amsterdam. No cash or additional public stock is to be exchanged in the takeover.

LEGAL

AIG Investors Lost $500 Million

Shareholders of American International Group lost more than $500 million as a result of a scheme to manipulate the insurance company's financial statements, a federal judge ruled. The ruling means five former insurance executives convicted of the scheme could face up to life in prison under advisory sentencing guidelines.

Prosecutors filed court papers citing a study by an expert concluding that the fraud-related losses to AIG shareholders totaled $1.2 billion to $1.4 billion. They cited another methodology by the expert that put the losses at $544 million to $597 million but said either method was reasonable. The judge rejected the higher estimate but said the lower range was reasonable.

Former UBS Manager Sentenced

A former UBS institutional client manager was sentenced to 6 1/2 years in prison for helping two hedge fund traders earn more than $15 million by leaking them tips about future changes in the firm's analyst ratings.

Mitchel Guttenberg, who worked in UBS's equity research department in New York, was also ordered to forfeit $15.8 million after pleading guilty in February to insider-trading charges. He faced as much as 8 years in prison under federal sentencing guidelines.

BUDGET

U.S. Borrowing to Jump

The federal government said it plans to borrow $550 billion in the last three months of this year as it raises cash to pay for an array of financial rescue packages. Treasury Department officials also projected the government would need to borrow an additional $368 billion during the first three months of 2009.

The nonpartisan Committee for a Responsible Budget estimates that all the government economic and rescue initiatives, starting with the $168 billion in stimulus checks issued earlier this year, total $2.6 trillion.

EARNINGS

Viacom said its third-quarter profit fell 37 percent, to $401 million from $641 million in the comparable period last year, as film studio Paramount Pictures' theatrical revenue fell more than a third and advertising sales declined. Revenue rose 4 percent to $3.4 billion.

TREASURY BILLS

T-bill rates fell. The discount rate on three-month Treasury bills auctioned yesterday fell to 0.53 percent from 0.9 percent last week. Rates on six-month bills fell to 1.1 percent from 1.4 percent, reaching their lowest level in more than four years. The annualized return to investors is 0.538 percent for three-month bills, with a $10,000 bill selling for $9,986.60, and 1.122 percent for a six-month bill selling for $9,944.39. Separately, the Federal Reserve said Monday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, fell to 1.44 percent last week from 1.66 percent the previous week.

Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.