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Corus Bank: A sign of failures to come?

In what could be a grim omen for the banking industry, Chicago’s Corus Bank has become the largest bank failure of the year, said Floyd Norris in The New York Times. The Federal Deposit Insurance Corp. seized the bank, which has $6.6 billion in deposits, after its portfolio of commercial real estate, once worth $4.5 billion, fell in value by 40 percent. Corus expanded rapidly during the decade, tripling its loan portfolio in five years and “gaining a reputation for aggressive lending” to condominium developers. Nearly half its loans were concentrated in California and Florida, where real estate values have plunged since 2007.

“Corus’ failure is the latest sign that banks, particularly small and midsize lenders, face a new round of pain beyond deteriorating home mortgages,” said Nick Timiraos and Jessica Holzer in The Wall Street Journal. Losses on commercial real estate, which sank Corus, could amount to more than $100 billion, affecting some 900 banks. Banks have $6.7 trillion in U.S. commercial real estate loans outstanding.

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Autos: GM settles on a buyer for Opel

General Motors has agreed to sell 55 percent of its Opel-Vauxhall European car division to Magna, a Canadian car-parts maker, and Russia’s Sberbank, said Bernard Simon in the Financial Times. “Russia is likely to be a key focus” of Opel’s marketing efforts. As part of the deal, GM, which already builds Chevrolets in Russia, is selling an assembly plant in St. Petersburg. Magna has said it may eliminate 10,500 jobs as part of its restructuring of Opel.

Shipping: FedEx recovers some optimism

Shipping giant FedEx has raised its first-quarter earnings estimate to 58 cents a share from 30 to 45 cents, “a sign that commerce is staggering back to its feet from its near-knockout,” said Jim Jelter in Marketwatch.com. FedEx is widely considered an economic bellwether; an uptick “in the volume of packages it ships around the world” bodes well for the broader economy. FedEx has seen a surge in shipping volume recently, especially overseas.

Computers: Jobs makes an appearance

Apple CEO Steve Jobs took the stage last week at an Apple product launch, returning to the public eye for the first time since going on medical leave in January, said Jessica Mintz in the Associated Press. “I’m vertical, I’m back at Apple, and I’m loving it,” said Jobs, 54. “Looking thin and speaking quietly and with a scratchy voice,” Jobs, who last spring received a liver transplant, introduced a new iPod Nano with a built-in video camera. He also urged those present to become organ donors.

Investigations: Financier’s sudden death

California financier Danny Pang, accused of defrauding investors out of millions of dollars, was found dead last week in his Newport Beach, Calif., home, said Christopher Goffard in the Los Angeles Times. Authorities have ruled out foul play and are investigating the possibility of suicide or an accidental drug overdose. A court-appointed receiver says Pang, 42, “took at least $83 million in inflated fees, salary, and loans” from his Private Equity Management Group before regulators seized it in April. Investigators have linked Pang to the Taiwan-based United Bamboo Triad, an Asian criminal organization.