Deals & People September 29, 2008

Wachovia Retirement Stays in Acquisition Deal

Wachovia Retirement Services is one of the business units not going to Citigroup as part of Monday’s acquisition of the Charlotte, North Carolina-based bank.
Reported by

According to a Wachovia news release, the company will retain its publicly traded status and will keep Wachovia Securities, the nation’s third largest brokerage firm, and Evergreen Asset Management. Under terms of the transaction, Citigroup will pay $2.1 billion to Wachovia and assume the senior and subordinated debt of Wachovia Corporation.

“During recent weeks, the financial landscape has changed significantly and presented us with unprecedented challenges,” said Robert K. Steel, CEO and President of Wachovia, in the news release. “Today’s announcement is the best alternative for the company, enabling a resolution on the Golden West portfolio.”

The transaction is expected to close before year end. It has been approved by directors of both companies and is subject to Wachovia shareholder approval and the appropriate regulatory approvals.

The Markets September 29, 2008

FRC: Mutual Funds See Modest Inflow in August

Stock and bond funds experienced net inflows of $401 million in August, according to the Financial Research Corporation (FRC).
Reported by

The Investment Company Institute (ICI) had different data, which was also released Monday (see “ICI: Mutual Funds Report More Modest Drop in August“). The ICI said the combined assets of the nation’s mutual funds decreased by $9.50 billion, or 0.08%.

According to FRC data, domestic equity funds experienced the largest net inflows for the month – $12.9 billion – while government funds came in a distant second with $2.9 billion in net inflows. International/Global equity funds experienced a net outflow of $21.5 billion.

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By Morningstar category, large blend funds brought in a net $7.5 billion in August. Intermediate-bond funds posted a net intake of $2.7 billion, followed by specialty-financial funds with a net intake of $2.1 billion.

State Street Global Advisors’ SPDR S&P 500 ETF led the sales chart, bringing in a net $3.6 billion for the month. PIMCO’s Total Return fund and Capital International’s Emerging Markets Growth fund took the second and third spots with net intakes of $1.7 billion and $1.6 billion, respectively.

Information on purchasing FRC’s data is available at www.frcnet.com.

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