Business News in Brief

The Federal Reserve said the economy expanded at a "modest to moderate" rate in June and early July, as retail sales and manufacturing cooled in some regions. In its Beige Book business survey, the Fed said of the Philadelphia bank district: "Overall, business activity in the Third District has continued to improve since the previous Beige Book, although results were mixed." It said manufacturing activity slowed. Retail sales and auto sales rose, "but at paces that varied across sectors and states." Banks in the Third District "reported steady growth in lending and stronger credit quality," and demand for new-home construction "held steady, and brokers report improving sales of existing homes." — Bloomberg News

PNC Financial Services Group Inc., the Pittsburgh bank with a major presence in the Philadelphia area, said second-quarter profit declined 40 percent on costs tied to mortgage-putback demands. Net income fell to $546 million, or 98 cents a share, from $912 million, or $1.67, a year earlier, PNC said in a statement. The average estimate of 22 analysts surveyed by Bloomberg was for adjusted earnings of $1.22 a share. PNC said earnings were reduced by a $284 million cost related to residential mortgage repurchase demands. The company said last month it would boost reserves by $350 million for that purpose. PNC is facing increased claims related to loans sold to government-sponsored enterprises as a result of the National City Corp. acquisition in 2009, the company said. Revenue increased 1 percent to $3.62 billion. Provisions for credit losses rose to $256 million from $185 million in the first quarter and compared with $280 million a year earlier. — Bloomberg News

The CEO of US Airways said Philadelphia's dominant airline may or may not be willing to wait for a merger until after American Airlines emerges from bankruptcy protection. Doug Parker has been vocal about wanting to merge with American. He said in a speech in Washington on Wednesday that US Airways was ready to talk about a merger now. But he said there's no guarantee that will be the case forever. American filed for bankruptcy protection in November. Its CEO initially resisted the idea of merging with US Airways, but recently American said it would study merger options. — AP

Tahira B. El, a practicing Muslim, faced religious discrimination when she was fired by her employer, a security company providing guards to the Pennsylvania Convention Center, because she refused to remove a head scarf she wore for religious reasons, according to a federal lawsuit filed in Philadelphia on her behalf Wednesday by the U.S. Equal Employment Opportunity Commission. The suit said that El, of Philadelphia, was hired by ABM Security Services, of California, to work at the center on Feb. 21, 2011. She was fired the next day, the suit said, when she showed up in uniform, wearing the khimar, which covers her hair and ears, but not her face. Because the Convention Center did not employ El, it is not named in the suit, but "we would not prohibit anyone from expressing their religious beliefs," convention center director Ahmeenah Young said in a statement. ABM said some clients require adherence to a strict uniform code. The company said in a statement that it was disappointed that the EEOC filed the suit because El was given the opportunity to work elsewhere but declined. — Jane M. Von Bergen

Government officials say one of two reactors at the Limerick nuclear power plant was shut down after an electrical malfunction. The Nuclear Regulatory Commission said a transformer problem in a turbine building led to the manual shutdown of the Limerick's Unit 1 reactor at 8:15 a.m. on Wednesday. The agency said Exelon Corp. soon announced an "unusual event," the lowest of four emergency classifications. — AP

Federal Reserve Chairman Ben S. Bernanke said U.S. central bankers are capable of removing record stimulus from the financial system and raising interest rates when needed to avoid triggering inflation. Bernanke spoke to the House Financial Service Committee. In his prepared testimony, Bernanke said inflation would probably remain at or below the central bank's 2 percent target. Bernanke also said the Fed is ready to take further action to boost the economic recovery if necessary. — Bloomberg News

Bank of America Corp.'s second-quarter profit report was marred by record demands for refunds on faulty mortgages. Net income was $2.46 billion, or 19 cents a share, compared with the year-earlier record loss of $8.83 billion, or 90 cents. The bank said it set aside less money for bad loans. But demands from bond investors and insurers that the bank take back defective mortgages jumped by more than $6 billion from the previous quarter to $22.7 billion. Excluding one-time items, earnings per share for the quarter would have been close to break-even, according to Ed Najarian at International Strategy and Investment Group L.L.C. — Bloomberg News

Following in Verizon's footsteps, AT&T Inc. said it would introduce wireless plans that let subscribers connect up to 10 phones or other devices. Connected phones get unlimited calling and texting; all devices get wireless data access. The devices tap into a limited pool of data usage, which is renewed each month. Verizon introduced its Share Everything plans on June 28, replacing nearly all of its traditional phone plans. AT&T says its Mobile Share plans will debut in late August, but it is keeping its current individual and family plans. AT&T's prices will closely track Verizon's. One smartphone with 1 gigabyte of data will cost $85 per month with AT&T, compared with $90 with Verizon. Two smartphones and a tablet computer with 6 gigabytes of shared data will cost $170 on either carrier. — AP