The news at a glance

Colonial BancGroup: Mauled by mortgages

Alabama’s Colonial BancGroup became the largest U.S. bank failure this year, after regulators last week seized the bank and sold its operations to a rival, said Cosby Woodruff in the Montgomery, Ala., Advertiser. North Carolina’s BB&T will take over Colonial’s $25 billion in assets and its 346 branches in five states. Colonial lent heavily to developers and home buyers in Florida, where the housing crisis has hit especially hard. The bank’s failure is the largest since regulators seized Washington Mutual and sold it to Bank of America in 2007.

Colonial’s demise is bad news for the U.S. mortgage market, which has recently been struggling back to life, said Colin Barr in CNNmoney.com. Colonial was a leading “warehouse” lender, buying mortgages from other lenders and holding them while they were being packaged into securities. The lenders then recycled the proceeds into more mortgage lending. With Colonial—which controlled a quarter of the $200 billion warehousing market—out of the picture, “mortgages could become even harder to get.”

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Banking: UBS will name U.S. clients

UBS, Switzerland’s largest bank, has agreed to turn over the names of thousands of its American clients, said Haig Simonian in the Financial Times. Lawyers involved in negotiations between the bank and federal prosecutors said UBS would divulge the names of about 5,000 U.S. account holders and pay a large fine. UBS has admitted helping clients evade U.S. taxes. “The case has significant implications for the future of client confidentiality,” and Swiss bankers worry that it could spark a flight of foreign accounts.

Home improvement: Lowe’s earnings fall short

Do-it-yourself retailer Lowe’s reported a 19 percent drop in quarterly earnings, as U.S. consumers put off remodeling projects, said Andria Cheng in Marketwatch.com. Net income fell to $759 million from $938 million in last year’s comparable quarter, on a 4.6 percent decline in sales. Until they see more convincing signs of a recovering economy, said CEO Robert Niblock, “cautious consumers remain reluctant to take on new projects.”

Supermarkets: Boycotting Whole Foods

Will granola-crunching liberals turn on their favorite supermarket? asked Foxnews.com. Some critics are incensed at the Whole Foods grocery chain, after CEO John Mackey wrote a column in The Wall Street Journal attacking President Obama’s health-care proposals. Anti–Whole Foods “campaigns are popping up all over, including on Facebook.” Whole Foods is the 10th-largest food and drug retailer in the U.S., reporting $1.8 billion in sales in its latest quarter.

Food processing: Companies sound sour note on sugar

Some of America’s biggest food companies have “bluntly raised the prospect of a severe shortage of sugar” if the Obama administration doesn’t lift import restrictions, said Scott Kilman and Carolyn Cui in The Wall Street Journal. In a letter to Agriculture Secretary Tom Vilsack, companies including General Mills, Kraft Foods, and Hershey warned of price hikes and worker layoffs unless the administration eliminates sugar tariffs. Several of the companies “are enjoying rising profits despite the recession.”