Here is a look at more of Monday's top business stories:
Mortgage delinquency on the rise
WASHINGTON, Dec. 3 (UPI) -- The Mortgage Bankers Association said the percentage of homeowners paying their mortgages late, as well as the percentage of mortgages in the foreclosure process, rose in the third quarter.
The Mortgage Bankers Association said its national delinquency survey, the delinquency rate for loans on one-to four-unit residential properties was 4.87 percent in the third quarter, up 24 basis points from the second quarter.
The percentage of loans on which foreclosure was started during the quarter rose 2 basis points to 0.38 percent, and the percentage of loans in the foreclosure process at the end of the quarter rose 4 basis points to 0.95 percent.
The delinquency rate increased for each of the three loan types that the MBA tracks.
The delinquency rate for conventional loans, or mortgages with the original value not bigger than $275,000 and the loan-to-value ratio at or below 80 percent, rose to 3.13 percent in the third quarter--up 20 basis points from the second quarter.
The delinquency rate for mortgages guaranteed by the Federal Housing Administration (FHA) jumped 57 basis points in the third quarter to 11.36 percent, the highest since the MBA began tracking delinquencies in 1972.
Mortgages guaranteed by the Veterans Administration (VA) had a delinquency rate of 8.11 percent, up 48 basis points from the second quarter.
All three loan types also experienced increases in foreclosures in the third quarter. The rate for conventional mortgages in foreclosure increased 2 basis point to 0.70 percent.
The percentage of FHA loans in foreclosure increased 14 basis points to 1.94 percent. And the percentage of VA loans in foreclosure rose 5 basis points to 1.25 percent.
The MBA attributed the higher delinquency rate to increasing unemployment resulting from the economy entering a recession. The events of Sept. 11 may have also be a factor in driving up short-term delinquencies, the MBA said.
Life and health insurers suffer sharp profit decline
PALM BEACH GARDENS, Fla., Dec. 3 (UPI) -- Profits of the nation's life and health insurers declined $6 billion, or 42 percent, during the first six months of 2001, compared to the same period last year, according to Weiss Ratings Inc., a provider of independent insurance company ratings and analyses.
Meanwhile, the industry's return on assets fell 44 percent to 0.51 percent, and the return on equity fell 45 percent to 7.3 percent, with the latter falling below 10 percent for the first time since 1995.
The profit declines are primarily due to a $2.2 billion capital loss on the sale of invested assets as well as a $3.1 billion decline in overall operating profits.
"All of these declines took place in the first and second quarters of the year, long before the Sept. 11 events, and they began well before the onset of the recession, now officially pegged to March," said Martin D. Weiss, chairman of Weiss Ratings.
"With the recession deepening in the second half and continuing into 2002, more profit declines are very likely as consumers delay the purchase of insurance, frequently viewed as a non-essential item," Weiss said.
The report also showed that in addition, insurers selling fixed annuities face a double threat.
First, with rapidly falling interest rates, income on their investment portfolios may have fallen below the rates they have committed to pay to policyholders. At the same time, junk bonds, one of the industry's favorite vehicles for generating more yield in this environment, have exposed insurers to increasing defaults.
"The average default rate on junk bonds more than doubled even before the onset of the recession," Weiss noted.
"Now, as the economy declines, bond defaults are bound to be even more frequent, potentially placing some insurers with high junk bond exposure at risk of failure. However, this factor is only one of many measures we consider in assigning an overall Safety Rating," he added.
Digimarc buys Polaroid's ID making unit
TUALATIN, Ore., Dec. 3 (UPI) -- Digimarc Corp., a developer of anti-counterfeiting systems, said it has agreed to buy Polaroid Corp.'s identification card-making business for $56.5 million in cash plus the assumption of liabilities and expenses.
Polaroid filed for bankruptcy protection in October and is working to sell off parts of the company or all of its assets.
Digimarc was announced as the winning bidder for the ID Systems business in an auction conducted by Polaroid in line with sale procedures approved by the U.S. Bankruptcy Court in Delaware.
Polaroid's ID Systems business produces 60 million secure personal identity cards per year, including the drivers' licenses for 36 U.S. states and other government identification documents around the world.
The business employs about 300 people, generates in excess of $50 million in annual revenues, and is profitable on a pro forma stand-alone basis.
Dana to combine engine and fluid businesses
TOLEDO, Ohio, Dec. 3 (UPI) -- Auto parts maker Dana Corp. said it will consolidate its engine and fluid businesses into one and said charges for a restructuring announced in October would be $445 million.
Dana said that 65 percent of the charges, or about $289 million, would be taken in the fourth quarter and the remaining charges would be taken in 2002.
In October, the company reported a third quarter operating loss and said it would cut more than 11,000 jobs, or 15 percent of its work force, and close plants as sagging auto sales hurt demand for auto parts.
"Over the past several months, we have talked about streamlining our organization to focus more sharply on our foundation businesses," said Dana Chairman and CEO Joe Magliochetti.
"The creation of the Engine and Fluid Management Group and the recently announced plans to divest the businesses of our Dana Commercial Credit leasing services operation are significant steps in that direction, effectively condensing our structure from seven business units to five," he said.
The new Engine and Fluid Management Group encompasses more than 130 operations in 15 countries with combined annual sales of approximately $2.3 billion. The group will provide strategic components and systems to enhance fuel economy and power generation.
"There are a number of new and exciting powertrain innovations being considered within our industry including fuel cells and other hybrid configurations," Magliochetti said.
"This new structure will better enable Dana to fully capitalize on these opportunities," he said.
To further leverage its engineering and manufacturing capabilities, Dana will also integrate its off-highway axle component manufacturing operations into its Commercial Vehicle Systems unit, reporting to group president Rick Clayton.
The company's off-highway sales, marketing, assembly, systems engineering and transmission manufacturing functions will continue to report to Off-Highway Systems President Nick Cole.
"In the current competitive environment, it is more essential than ever before that we optimize our global capabilities and provide even greater value for our customers," Magliochetti said.
"This new structure will enable the Off-Highway Systems Group to continue its comprehensive market focus, while we accelerate our axle manufacturing efficiencies," he added.
