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Business news in brief

Business news from around the region and elsewhere.


Insider trading charged

The U.S. Attorney in Philadelphia charged Timothy McGee, of Philadelphia, with insider trading, saying that McGee learned of the pending acquisition of Bala Cynwyd insurer Philadelphia Consolidated Holding Corp. by Tokio Marine from a Philadelphia Consolidated executive McGee knew through Alcoholics Anonymous. The two-count indictment of McGee, 48, alleges that he made $292,000 from illegal trades. The indictment also alleges that McGee tipped a friend to the pending sale of Philadelphia Consolidated. In March, the Securities and Exchange Commission filed a related civil lawsuit against McGee and four others. Illicit profits totaled $1.8 million, according to the SEC. If convicted, McGee faces up to 25 years in prison. McGee's lawyer, John C. Grugan, did not immediately respond to a request for comment. — Harold Brubaker

AmerisourceBergen buying back shares

Pharmaceutical services company AmerisourceBergen Corp., Valley Forge, announced a $750 million share repurchase program. The company also said it has completed a similar $750 million repurchase that was authorized in August 2011. The company said it expected to repurchase shares, subject to market conditions. AmerisourceBergen has about $80 billion in annual revenue and 13,000 employees. Shares were up 2 percent to $36.73 in afternoon trading. — Reid Kanaley

Aramark details CEO pact

Aramark Corp., the Philadelphia food-services and facilities manager, said in a regulatory filing with the Securities and Exchange Commission that the employment agreement with new chief executive Eric J. Foss calls for Aramark to pay him an annual salary of $1.35 million. He will also receive a guaranteed six-month pro-rated bonus of $1,012,500 for fiscal 2012 as well as a one-time signing bonus of $500,000. Under the terms of the agreement, Foss is required to hold Aramark stock worth six times his annual salary and is expected to make his initial investment of $3.75 million in June. Joseph Neubauer, who stepped down as CEO effective May 7 but remains Aramark's chairman, received a salary of $1.35 million and a bonus of $2.5 million in fiscal year 2011. — Mike Armstrong

Aramark reports quarterly earnings

In Aramark's filing with the Securities and Exchange Commission, the company also said net income was $9.89 million in the quarter ended March 30, down 52 percent from $20.39 million for the same quarter of 2011. In terms of operating income, Aramark reported a 9.4 percent increase to $133.71 million from $122.27 million. Sales rose 3.9 percent in the second quarter to $3.35 billion from $3.22 billion a year ago. In its filing with the SEC, the privately held company, which has some public debt, attributed the increased sales to growth in its higher education business, as well as the sports and entertainment and health-care parts of its North American Food and Support Services unit. — Mike Armstrong

A.C. casino revenues decline

Despite the addition of Revel, the dozen Atlantic City casinos reported $260.6 million in total gambling revenue last month, down 10 percent from April 2011. Overall, Borgata was able to weather the soft-opening of Revel during April, declining only 0.3 percent. Revel generated $13.4 million in revenue for its first full month of operation with more than half of its restaurants and rooms open. Only two properties reported revenue increase revenues — Tropicana (up 38.9 percent) and the Golden Nugget (up 1.0 percent). The other eight casinos reported double digit revenue declines last month. — Suzette Parmley

WSFS reduces reported net

WSFS Financial Corp., Wilmington, reduced its net income for the first quarter by 11 percent to $6.4 million from the $7.2 million reported April 26 after adopting a system for rating the riskiness of its loans, the bank said. The result was a 24 percent increase in the bank's provision for loan losses to $8.25 million from $6.67 million. WSFS, which has 49 offices, mostly in Delaware, also said it would sell troubled loans with unpaid balances of $52 million. The bank had $2.8 billion in total loans outstanding at the end of March. Possibly offsetting the anticipated loss on the sale of troubled loans will be the expected gain on the planned sale of $300 million in "high quality" mortgage-backed securities, the bank said. — Harold Brubaker


A rare monthly budget surplus

For the first time in nearly four years, the U.S. government last month took in more money than it spent. The surplus for April was a welcome sign that the economy is trudging back to health. Still, it's just one month of black ink in a budget stained in red. For the budget year, the country remains on track for a fourth straight $1 trillion deficit — a trend that should keep the deficit near the center of the presidential race. Through the first seven months of the budget year that began Oct. 1, the United States has run a $719 billion deficit, the Treasury Department said. The April surplus of $59.1 billion isn't unusual, because annual tax returns are due that month. Yet as the first April surplus since the 2008 financial crisis erupted, the surplus shows that modest job growth and higher corporate profits have boosted tax revenue. — AP

Deutsche Bank settles mortgage suit

Deutsche Bank AG agreed to pay $202.3 million to settle civil claims that its MortgageIT unit lied to qualify thousands of risky mortgages for a federal insurance program in what the U.S. called a "massive fraud." The federal government contended in a lawsuit filed May 3, 2011, that Deutsche Bank and MortgageIT falsely certified that they properly assessed the default risk of borrowers, qualifying loans for insurance by the Housing and Urban Development Department's Federal Housing Administration. The bank admitted to some of the conduct alleged in the complaint, according to a statement by the office of U.S. Attorney Preet Bharara in Manhattan. The U.S. sued under the False Claims Act, which permitted it to seek triple damages and penalties of more than $1 billion. "We are very pleased to have reached this settlement, for which we have already fully reserved, and to put this issue behind us," a Deutsche Bank spokeswoman said in a statement. — Bloomberg News

New low for fixed-rate mortgages

Fixed mortgage rates fell to an all-time low for the second consecutive week, with the 30-year averaging 3.83 percent, Freddie Mac said Thursday. Last week, the rate was 3.84 percent. The 30-year fixed-rate mortgage has averaged below 4 percent all but one week since Dec. 8. A year ago, the rate was 4.63 percent. The 15-year rate was 3.05 percent, while five-year hybrid adjustables were 2.81 percent. — Alan J. Heavens

Hang-ups on phone contracts

Figures from T-Mobile USA, added to earlier reports, indicate that the U.S. wireless industry lost subscribers from contract-based plans for the first time in the first quarter. Contract plans are the most lucrative ones for phone companies. The seven largest U.S. phone companies, representing more than 95 percent of the market, lost a combined 52,000 subscribers from contract-based plans in the January-to-March period. — AP