Executive Business Briefing

Here is a look at more of Monday's top business stories:

Semiconductor sales rise

SAN JOSE, Calif. March 31 (UPI) -- The Semiconductor Industry Association, or SIA, said semiconductor sales rose to $11.8 billion in February from $10 billion a year earlier but fell 3.3 percent from January as demand softened in the personal computer, wireless and consumer markets.

SIA said a seasonally flat first quarter has been further hurt this year by geopolitical uncertainty.

However, the association said demand should strengthen in the second half, leading to double-digit growth for the year. In early February, the SIA said it expected 19.8-percent growth in 2003 revenue, suggesting 2003 chip revenue of $169.3 billion.

In February, sales fell sequentially in all geographic markets, but year-over- year sales rose 17 percent in Europe, 35 percent in Japan and 26 percent in the Asia Pacific market.

In the Americas, sales dropped 4.5 percent to $2.41 billion from $2.52 billion a year earlier because of continued outsourcing of electronic equipment production and component purchases to Asia, particularly China.

Wachovia says SEC looking into its stock purchases

CHARLOTTE, N.C., March 31 (UPI) -- Wachovia Corp. said it has raised its first-quarter earnings outlook and cut merger-related expenses and also announced a Securities and Exchange Commission investigation into company-related stock purchases from 1996-2001.

The banking company said purchases of legacy First Union and legacy Wachovia common stock from 1996-2001 are the subject of an SEC probe, with a particular focus on purchases following the April 2001 merger announcement.

First Union acquired Wachovia in September 2001 for $14 billion, with the combined company taking the Wachovia name.

Wachovia said it believes all purchases by the legacy companies were in compliance with law and in accordance with the advice of U.S. securities law firms.

The company said it is cooperating with the SEC and doesn't believe the investigation will hurt its financial condition or results.

The investigation doesn't pertain to the integrity or accuracy of Wachovia's financial reporting or financial statements or to insider trading, the company said.

Wachovia also said its 2003 first quarter earnings per share are expected to be 72 to 74 cents a share, including approximately 4 cents a share of merger-related and restructuring charges. Excluding merger-related and restructuring charges, earnings are expected to be 76 to 78 cents a share, which exceeds the current Thomson First Call estimate of 72 cents a share.

Wachovia also said it expects to grow earnings per share 10 percent or more in 2003, excluding merger-related and restructuring charges, from $2.77 per share in 2002. Wachovia earned $2.60 per share in 2002, including 17 cents a share of merger-related and restructuring charges.

Ken Thompson, chairman and chief executive officer, said, "Although general economic conditions remain weak, our focused customer approach and the benefits of the First Union-Wachovia merger have enabled us to produce better-than-expected results. We're pleased with our performance in the first quarter and we're optimistic about the remainder of 2003."

Commerzbank cuts 3,100 jobs

FRANKFURT, March 31 (UPI) -- Commerzbank AG said it will cut 3,100 jobs, including 500 from its investment bank, in an effort to push costs down and return to profit.

The bank said it will cut costs by $497 million, to below $5.4 billion, and then further reduce costs to $4.9 billion in 2004. In 2002, the bank's costs amounted to $5.6 billion, down from $6.4 billion in 2001.

The bank, Germany's fourth largest, will cut 1,500 jobs in Germany, from the bank's headquarters, and 1,100 jobs in foreign operations. That's on top of the 500 jobs that will go from the investment bank, which Commerzbank already announced.

Since Commerzbank began cutting costs in 2001, the lender has cut 4,300 jobs. Commerzbank plans to trim its work force to 32,000 employees from 39,500 at the end of 2001.

Klaus-Peter Mueller, chief executive of Commerzbank, said the company "must make itself slimmer and fitter in order to reach the goal of returning to the black this year."

Commerzbank also said that it will boost its lending to mid-sized companies, known in German as the Mittelstand, by $1.1 billion. The supervisory board decided at its meeting that it has some room to increase loans, after risk assets decreased and the bank's solvency ratio at 7.3 percent.

Commerzbank said it will expand its loans to mid-sized companies through a program with the government-funded Kreditanstalt fuer Wiederaufbau, which offers low-rate loans for mid-sized companies.

Commerzbank also said that it appointed Nicholas Teller, 43, to the management board, to head the corporate bank. Teller had been a regional board member in charge of corporate customers in northern Germany and Scandinavia. He takes over from Andreas de Maiziere, who will remain on the management board and focus on IT and operations.

The bank said it named Eric Strutz, 38, chief financial officer and a management board member. He had been head of the bank's controlling and strategy departments. Strutz replaces Axel von Ruedorffer, who will retire this year.