Standard & Poor's last week cut the debt ratings for Riggs National Corp. and its Riggs Bank because of concerns about their ability to turn around losses, leaving Riggs with the lowest rating of any bank in the country, S&P said.
"We're becoming increasingly concerned about the ability of Riggs to return to profitability in the near future," said Charles D. Rauch, managing director.
Rauch said Riggs's third-quarter loss resulted largely from its legal troubles and related expenses from several criminal and civil investigations.
"We see those expenses staying at a high level over the near-term. Therefore, we have questions about the turnaround in profitability," he said.
S&P cut the ratings by two notches Nov. 11, noting that the Washington bank has lost deposits since it quit the embassy banking business that got it into trouble.
Earlier this year Riggs was hit with a record $25 million fine for failure to abide by federal anti-money-laundering laws.
The rating for Riggs National Corp. dropped from B+, already below investment grade, or "junk" status, to B-, while the rating on the bank dropped from BB to B+. Both of those ratings are also below investment grade.
At the same time S&P put both on "CreditWatch developing," which means the ratings could go up or down, reflecting caution about Riggs's proposed merger with PNC Financial Services Group. When the merger was announced, the CreditWatch rating had been upgraded to positive.
George C. Newstrom, who resigned in October as Virginia's secretary of technology, is to become chief executive and president of Wisper Technologies, a new wireless applications firm in Reston. Wisper is a wholly-owned subsidiary of IMC Inc., a Reston information technology company where Newstrom serves as a board member. The company said it is developing technology to provide doctors, lawyers and other professionals with "portable electronic records."
Radio One, the nation's largest broadcaster targeting black audiences, says it is programming one of its stations in Spanish. Houston's KROI-FM will compete against Spanish-language media company Univision Communications, which owns a hip-hop station in the market. Radio One, based in Lanham, also owns a youth-targeted hip-hop station and an adult-targeted R&B station in Houston. KROI, which Radio One bought for $72.5 million this year, is the only one of its 69 stations targeted at Hispanic listeners.
Discovery Communications had third-quarter revenue of $557 million, compared with $474 million a year earlier. Liberty Media, the New York-based media holding company, released the figures as part of its third-quarter earnings report. Liberty owns 50 percent of privately-held Discovery, which does not release profits. The other owners of Discovery include Cox Communications and Advance/Newhouse Communications, each with about 25 percent. Operating income for the Silver Spring-based cable programmer grew to $129 million during the third quarter, up from $78 million a year earlier. Liberty attributed the revenue increase at Discovery to better distribution worldwide, higher ratings at most of the company's networks, a growing number of subscribers and beneficial exchange rates.
Lucky Strike Lanes, an upscale bowling alley, lounge and restaurant, agreed to open inside Gallery Place, a new downtown Washington shopping and entertainment center, the developer said. Herb Miller, who co-developed the center at Seventh and H streets NW, said Lucky Strike will open in the spring as the only bowling alley downtown. Meanwhile, chef Richard Sandoval, who owns Maya, a high-end Mexican restaurant in New York, has struck a deal to open a restaurant in Gallery Place. The restaurant, called Zengo, blends South American and Asian cooking. It is to open next summer, Sandoval said.
The Washington Business Hall of Fame plans to induct five people tomorrow night at an event to raise money for Junior Achievement. Inductees are former Pepco chairman John M. Derrick Jr.; Marie C. Johns, the former president of Verizon Washington; former America Online chairman Steve Case; P. Wesley Foster Jr., chairman of Long & Foster Cos.; and Robert B. Pincus, chairman of Milestone Merchant Partners and former president of BB&T Bank in the Washington region.