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NYCB has been downgraded to junk by Fitch as Moody's goes even lower

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(Bloomberg) — New York Community Bancorp's credit rating was downgraded to “junk” by Fitch Ratings and Moody's Investors Service lowered its rating even further, a day after the commercial real estate lender said it had “material weaknesses” in monitoring of credit risks identified.

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Fitch downgraded the bank's long-term issuer default rating from BBB- to BB+, one notch below investment grade, according to a statement Friday. Moody's, which downgraded the bank to junk status last month, cut its issuer rating to B3 from Ba2.

The bank's discovery of vulnerabilities “led to a review of NYCB's controls over the adequacy of reserves, particularly with respect to its concentrated exposure to commercial real estate,” Fitch said.

Read more: NYCB highlights weaknesses in credit supervision, names new CEO

The bank's announcement Thursday that it would need to strengthen loan reviews renewed concerns among investors about the company potentially risking troubled commercial property owners, including apartment landlords in New York. The stock plunged 26% on Friday, even as the company said it did not expect control weaknesses to lead to changes in loan loss provisions.

“Moody's expects that NYCB may need to further increase its loan loss provisions over the next two years due to credit risk on its office loans,” the credit rater said in a statement. It also flagged “significant repricing risk on its multifamily loans.”

NYCB stock ended the week at $3.55, down 65% this year.

“The company has strong liquidity and a solid deposit base,” Chief Executive Alessandro DiNello, who took over this week, said in a statement Friday. “I am confident that we will execute our turnaround plan to increase shareholder value.”

The story goes on

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BMR’s Price Reduction: Impact of Container Price Plummet

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A toilet costs from $120 to $97 (-19% in two years) or even a laminate floor costs from $1.27 per square foot to 99 cents (-22% in one year). BMR has managed to reduce prices in many stores despite inflation due to the crash in container prices.

“During the pandemic, there was an abuse of maritime transport companies,” explains Alexandre Lefebvre, CEO of BMR for three years, in an interview with the Journal.

This had a direct impact on the prices of items on store shelves. For example, the prices for containers with products from China melted like snow in the sun.

“It was stratospheric. However, container prices have fallen significantly,” he adds. BMR speaks of a container whose price has increased from $33,000 to $4,000. Not to mention the prices for forest products have also fallen, notes Alexandre Lefebvre.

Falling prices at BMR due to the sudden drop in container prices

A toilet for $97.49. Provided by BMR

Falling prices at BMR due to the sudden drop in container prices

A minimum price of $0.99. Provided by BMR

Fourth in the world

As a result, BMR has been able to reduce its prices in recent months despite a sharp drop in housing starts and a decline in renovation demand, with container prices for goods imported from the other side of the world falling.

The Quebec hardware retailer also signed a key partnership with the ARENA Alliance, giving it access to better volume pricing. This buying group enables him to achieve good prices and thus remain attractive to the American giants that are struggling for help.

Falling prices at BMR due to the sudden drop in container prices

A BMR truck loaded with construction materials. Provided by BMR

“After Home Depot, Lowe's and Leroy Merlin in France, we have become the fourth largest provider of purchasing power for hardware in the world,” explains the boss of BMR proudly.

Falling prices at BMR due to the sudden drop in container prices

In 2023, Soumission Rénovation recorded a 27% decrease in average project value compared to 2022. Provided by Soumission Rénovation

Ontario Dream

In addition to efforts to reduce store prices, BMR continued its expansion in Ontario.

Today, there are about 23 locations in Doug Ford's province, mostly independent stores and some distribution centers.

Last Thursday, BMR said its net surplus fell from $41 million in 2022 to $34.5 million last year, due to a decline in housing starts, the explosion in household debt and interest rates be.

“In Quebec in particular, we saw a significant decline in housing starts. We're talking about thirty [de points de] of percentages. It's enormous. These are catastrophic numbers. It hurts,” analyzed Alexandre Lefebvre.

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OpenAI Says Musk’s Lawsuit Claims are Because Elon Feels Sorry for Leaving

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Musk co-founded OpenAI in 2015 and resigned from the board in 2018, four years after saying that AI was “potentially more dangerous than nuclear weapons.”

Musk is now suing Microsoft–supported OpenAI and CEO Sam Altman, among others, claiming they had abandoned the company's founding mission to develop artificial intelligence “for the benefit of humanity at large.”

Since releasing the ChatGPT chatbot in late 2022, OpenAI has become one of the hottest startups in the world, reportedly valued at over $80 billion. The company's complicated capped-profit structure led to Altman being briefly ousted from the board late last year, before an uproar among investors and employees led to his quick reinstatement.

Musk has long wanted recognition for his central role in the development of OpenAI and spent large portions of the lawsuit telling his version of events. His lawyers said in the lawsuit that Altman and OpenAI co-founder Greg Brockman approached Musk in 2015 and agreed to create a nonprofit lab that would develop artificial general intelligence (AGI) outside the corporate sphere.

Musk's lawyers said their client donated over $15 million to OpenAI in 2016, which was “more than any other donor” and helped the startup build a team of “top talent.” The next year, Musk donated nearly $20 million to OpenAI, which lawyers reiterated was more than other supporters. According to the lawsuit, Musk invested a total of over $44 million in OpenAI from 2016 to September 2020.

In addition, Musk rented OpenAI's first office space and “paid the monthly rental costs,” the lawsuit says. He was also “present at important company milestones.”

Kwon didn't deny Musk's central role in the early days of OpenAI, but added a few more details. For example, Kwon wrote that Musk once indicated that he needed “full initial control and majority ownership” and later proposed merging OpenAI with Tesla.

“We did not consider either approach to be the right solution for the mission,” Kwon wrote.

In the memo, Altman called Musk one of his heroes and said he missed the old version of his co-founder. But he said the company's mission remains.

Although this is the first time the dispute between the two sides has escalated into a heated legal battle, they have been at odds for some time.

Before parting ways with OpenAI, Tesla hired co-founder Andrej Karpathy as senior director of AI. Karpathy returned to OpenAI in 2023. And Musk has been outspoken against OpenAI and its Microsoft partnership in recent years, publicly declaring in November that OpenAI had deviated from its original mission.

“OpenAI should be renamed 'Super Closed Source for Maximum Profit AI' because that's exactly what it is,” Musk said on stage at the New York Times' DealBook conference. On OpenAI's transformation from an “open source foundation” to a billion-dollar, for-profit company, Musk said: “I don't know, is that legal?”

Kwon emphasized Friday that OpenAI is independent and continues to work to “ensure that AGI benefits all of humanity.”

Musk's lawyers did not immediately respond to a request for comment.

—CNBC's Lora Kolodny and Hayden Field contributed to this report

REGARD: Elon Musk's lawsuit against OpenAI and Altman began a year ago

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In the eyes of Quebec Inc.: The Caisse de dépôt is investing again in BRP

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In this bi-weekly column, we provide an overview of insider transactions and investments in Quebec companies.

• Also read: The Smart Investor: Four Ways to Invest in Gold

• Also read: In the eyes of Quebec Inc.: The big Metro boss pockets more than $3 million

The institute is betting on a rise in shares

The Caisse de dépôt has been very active in BRP shares over the past year. In February 2023, she sold more than $22.5 million worth of shares in the motorsports company (at a price of $120 each). Then, from September to December, the company repurchased $54.4 million worth of BRP shares, with the share price fluctuating between $99 and $81. These transactions have just been made public. Today the Caisse holds about 7% of BRP shares. The stock is currently trading at around $90.

Buyer at Innergex

In the eyes of Quebec Inc.: The Caisse de dépôt is investing again in BRP

Michel Letellier Photo LinkedIn

Four Innergex insiders have bought shares in the renewable energy producer since the end of last week. The Longueuil company's CEO, Michel Letellier, bought it for more than $105,000, while chief financial officer Jean Trudel acquired it for nearly $100,000. For his part, Marc-André Aubé, who joined Innergex's board in December, invested almost $308,000 in the company, while Richard Gagnon, another director, donated more than $25,000. Innergex shares have risen more than 15% since the company announced a 50% cut to its dividend last week, which will allow it to better fund its future projects.

Nice win for a Metro manager

In the eyes of Quebec Inc.: The Caisse de dépôt is investing again in BRP

Frédéric Legault Photo Metro

Metro information systems chief Frédéric Legault made a profit of more than $150,000 last week by exercising stock options. The retailer's stock is up about 7% year-to-date and nearly 50% over the past five years.

iA CEO buys

In the eyes of Quebec Inc.: The Caisse de dépôt is investing again in BRP

Denis Ricard Photo iA Financial Group

Denis Ricard, CEO of iA Financial Group since 2018, bought $344,000 worth of shares in the Quebec insurer this week. The stock has fallen more than 5% since the start of the year.

The Caisse is reducing its shares in Intact

In the eyes of Quebec Inc.: The Caisse de dépôt is investing again in BRP

Intact advertising campaign with Patrick Huard. Photo intact

The Caisse de dépôt said this week it would sell shares in non-life insurer Intact worth at least $525 million. The institute invested $1.5 billion in the Toronto company in 2021 to help it get its hands on divisions of British insurer RSA. Intact stock is up more than 30% since June 2021.

A power manager exercises options

In the eyes of Quebec Inc.: The Caisse de dépôt is investing again in BRP

Denis Le Vasseur Photo Power Corporation

Denis Le Vasseur, vice president and controller of Power Corporation, made a profit of just over $180,000 this week by exercising options from the Montreal conglomerate. He has been with the group since 1992.

You buy KDA

In the eyes of Quebec Inc.: The Caisse de dépôt is investing again in BRP

Marc Lemieux Photo LinkedIn

Two KDA Group executives increased their stake in the company this week. KDA's CEO, Marc Lemieux, bought nearly $38,000 worth of shares in the company, while a director, Isabelle Bégin, purchased more than $42,000 worth of shares. KDA specializes in “accelerating the digital transformation of healthcare.” The company's TSX Venture Exchange-listed stock is up more than 40% this week, up 170% year-to-date and up about 500% over the past 52 weeks.

In the eyes of Quebec Inc.: The Caisse de dépôt is investing again in BRP Read More »

The Mega Millions jackpot increases to $650 million if no ticket matches the winning numbers

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Check out what's happening at FoxBusiness.com

The Mega Millions jackpot grew to an estimated $650 million after no one had the same winning tickets in Friday night's drawing.

The winning numbers drawn for Friday night's $607 million drawing were 61, 33, 15, 37 and 55 with a Megaball of 24. The Megaplier was 4X.

The next Mega Millions drawing takes place on Tuesday, with players hoping to win the estimated $650 million jackpot, which comes with a cash option of $308.6 million. Winners typically select the cash prize above the Mega Millions Annuity, which is paid as an immediate payment followed by 29 annual payments.

The Mega Millions jackpot rises to $607 million ahead of Friday's drawing, making it the eighth-largest prize in the game's history

The winning numbers drawn for Friday night's $607 million drawing were 61, 33, 15, 37 and 55 with a Megaball of 24. The Megaplier was 4X. (Jakub Porzycki/NurPhoto via Getty Images) / Getty Images)

The odds of winning the top prize are 1 in 302,575,350.

The Mega Millions jackpot was last won on December 8, when two winners in California matched all six numbers and took home the $395 million prize.

The record jackpot of $1.602 billion was won in Florida on August 8, 2023. This prize is the world's largest lottery prize ever won with a single ticket.

The winner of Florida's $36 million Mega Millions jackpot never claimed it

The odds of winning the top prize are 1 in 302,575,350. ((Photo illustration by Justin Sullivan/Getty Images) / Getty Images)

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The current jackpot of $650 million is the seventh largest prize ever offered in the game.

Mega Millions is played in 45 states as well as Washington, DC and the U.S. Virgin Islands. The deadline for purchasing tickets is 9:45 p.m. on draw nights.

The Mega Millions jackpot increases to $650 million if no ticket matches the winning numbers Read More »

California approves Waymo expansion to LA and highways

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SAN FRANCISCO – California regulators granted Alphabet's self-driving car division Waymo permission on Friday to expand its robotaxi service to highways in several Bay Area cities and large parts of Los Angeles to have on city streets.

The California Public Utilities Commission (CPUC) decision allows the company to deploy its robotaxis on local streets and highways at speeds of up to 65 miles per hour. But Julia Ilina, a spokeswoman for Waymo, said in a statement that the company wants to take a “cautious and gradual approach to expansion” and has “no immediate plans” to expand its robotaxi service to highways.

The ruling still represents a massive expansion for the company, which has been offering its 24/7 robotaxi service in San Francisco and Phoenix for months. The company tests its cars on highways in California with a safety driver behind the wheel, but in Phoenix the tests don't involve a human driver on highways, Ilina said. The company is currently not transporting passengers on highways.

Friday's decision follows fierce opposition from local officials — particularly in San Mateo and Los Angeles counties — who sought to stop the expansion, arguing that they should have more power over how and whether the technology is used on their streets becomes. In a November letter to the state commission, Los Angeles Mayor Karen Bass said she was concerned about the “adverse impacts” the expansion would have.

“In a city that spans 500 square miles, has a population of about 4 million, and has 7,500 miles of roads, the risk is exponentially greater,” she wrote.

But the CPUC, which regulates the technology for the state, said in its decision that Waymo had “meeted the requirements” and may expand immediately. Despite the opposition, Waymo also received support from a number of groups in California – including the California Chamber of Commerce and the California Bicycle Coalition.

“CalBike sees autonomous driving technology as an opportunity to improve roads across California and the country,” the coalition said in a statement. “Waymo’s technology has the potential to create a safer road environment by eliminating human error and adhering to traffic rules, such as speed limits, that many human drivers do not follow.”

Still, fears of self-driving cars are likely to continue in California, where several incidents last month fueled officials' safety concerns about vehicles coming to their cities. For example, on several days in February, a Waymo vehicle crashed into a closing gate while leaving the University of Southern California campus, and the next day another car collided with a cyclist in San Francisco.

Then, days later, the company announced a voluntary recall of its software for an incident involving a pickup truck in Phoenix.

There were no major injuries in any of the incidents.

Ilina said the company is “grateful to the CPUC for this vote of confidence in our operations.”

“We are incredibly grateful to the drivers and community partners who have supported our service to date – including over 15,000 rides in LA to date – and look forward to bringing the benefits of fully autonomous ride-hailing to even more people,” she said .

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Lawyers who scuttled Musk's pay package are demanding $6 billion in Tesla shares

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Downward Angle Symbol A symbol in the form of an angle pointing downwards. Advertisers have fled X in recent months following a series of controversies surrounding its owner Elon Musk. Antonio Masiello

  • Lawyers for a Tesla shareholder have successfully secured Elon Musk's $56 billion pay package from Tesla.
  • Now they're asking a judge to give away about 11% of Tesla's shares, worth about $6 billion, for legal fees.
  • Musk called the request “criminal.”

Lawyers for a Tesla shareholder have successfully argued in a Delaware court that Elon Musk doesn't deserve a $55 billion compensation package for his work at the electric vehicle company.

Instead, part of that compensation package should go to them in the form of legal fees, the lawyers argued to a Delaware judge.

The lawyers argued in a statement of claim filed Friday that the fee for their litigation work represents about 11% of the salary package. That equates to approximately $5.96 billion worth of Tesla stock, based on the company's current stock price of $202.64 per share.

Chancellor Kathleen McCormick of the Delaware Chancery Court must now decide how much of the compensation package can be used for legal fees.

Tesla and Musk still have the opportunity to appeal the overall decision to void the CEO's stock options.

According to the Journal, plaintiffs' attorneys typically receive one-third of a verdict or settlement amount. The attorneys argued in their filing that they were not seeking the “33% of quantifiable benefit granted” based on “well-established precedent.”

“Plaintiff’s counsel was not paid for their work, nor were they reimbursed for any costs or expenses, and litigating this action required significant expenditure of time and resources by Plaintiff’s counsel over a period of six years, including significant out-of-pocket expenses. “Costs,” the lawyers wrote.

Unsurprisingly, Musk is not happy with the lawyers' demand.

“The lawyers who did nothing but damage Tesla want $6 billion,” he wrote on X on Friday evening. “Criminal.”

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In 2018, Richard Tornetta, a former heavy metal drummer and Tesla shareholder, sued the electric vehicle company, claiming that the Tesla CEO used his close relationships with the company's board members to secure a massive pay package, and that the company thereby breached its fiduciary duties to its shareholders.

McCormick agreed with Tornetta in January and rejected Musk's pay package.

The decision infuriated Musk, who later announced on X that you should “never incorporate your company in the state of Delaware.”

Tornetta's lawyers, including lead attorney Greg Varallo of Bernstein Litowitz Berger & Grossman, wrote in Friday's court filing that his team was ready to “eat our food.”

The plaintiff's team also included the law firms Andrews & Springer and Friedman Oster & Tejtel.

The lawyers realized that the payday would be a record-breaking claim.

“We recognize that the requested fee is unprecedented in its absolute magnitude,” he said in the filing. “The amount of the award sought is great because the value of the benefit that plaintiff’s counsel obtained for Tesla was enormous.”

Musk did not immediately respond to a request for comment sent outside of business hours.

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Boeing is negotiating to acquire Spirit Aerosystems

Business News / By

March 1, 2024

Updated 8 hours ago

Image source: Getty Images

Boeing is in talks to acquire Spirit Aerosystems, the supplier that has been involved in many of its recent production problems.

The company, a leading global supplier of aircraft parts, was spun off from Boeing in 2005 as part of a cost-cutting move.

The company continues to rely on Boeing for more than two-thirds of its business.

Boeing is under pressure over its production pipeline after part of one of its planes exploded in mid-air in January.

The U.S. government's investigation into the explosion found that at Boeing's Washington plant, screws securing the plate had been removed, apparently to repair damaged rivets, and were never reinstalled.

The part was manufactured by Spirit before being sent to Boeing for final assembly.

This week, the Federal Aviation Administration (FAA), which has been investigating Boeing since the incident, gave Boeing 90 days to develop a “comprehensive action plan” to improve its safety management systems.

Boeing has already worked closely with Spirit to address a number of quality issues that caused delays in aircraft deliveries and led to the appointment of a new CEO at Spirit last year.

In a statement to Portal on Friday, Boeing said: “We believe that the reintegration of Boeing and Spirit AeroSystems' manufacturing operations would further strengthen aviation safety, improve quality and serve the interests of our customers, employees and shareholders.”

Spirit shares rose more than 10% on Friday after reports of takeover talks, giving it a market value of more than $3.7 billion.

But Boeing shares fell more than 1% after the discussions were first reported in the Wall Street Journal.

Spirit, which the Journal said is also considering a sale of its Northern Ireland unit to Airbus, did not respond to the BBC's request for comment.

Spirit employs more than 20,600 people worldwide, including around 3,400 in Belfast and 1,120 in Prestwick.

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