Source: www.nytimes.com

LONDON, March 23 In the snow-covered mountains of Davos, Switzerland, top executives of Barclays, the British bank, and ABN Amro, a Dutch rival, ran into each other at the World Economic Forum in January.

Among other things, they shared their sense of intrigue at the
possibility of working together to create a global banking group that
might rival HSBC Holdings.
With growth limited at home, particularly as regulators move to block
local takeovers, numerous large European banks are finding that buying
rivals abroad can be a more viable route to expansion.

But as with previous such discussions between ABN and Barclays over the
last two years, nothing happened. Then along came the Children�s
Investment Fund, a London hedge fund that is known for building up a
sizable stake in an underperforming company to put pressure on
management to turn around its performance. Now Barclays and ABN are on
the verge of a deal.

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Gov. Haley Barbour on Thursday signed a new law designed to shore up
Mississippi’s insurer of last resort and to bring economic stability to
a state still recovering from Hurricane Katrina.

After Katrina plowed across the state Aug. 29, 2005, insurance prices for
homeowners and businesses increased sharply in some areas, stagnating
redevelopment on the coast.

The bill Barbour signedThursday is designed to strengthen the Mississippi Windstorm
Underwriting Association, often called the wind pool. The association
provides coverage in areas insurance companies deem too risky. The bill
became law immediately.

One of our goals here, one of the purposes of the wind pool, is to
make insurance available and to make it affordable, Barbour said. By
keeping these rates lower, we not only keep rates lower for people on
the coast, we keep rates lower for people all over the state.

The law gives the state’s roughly 32,000 wind pool policy holders a price
break on premiums, which Barbour said would lower rates statewide.
Lawmakers had estimated the relief would be $500 a year for each policy
holder. It will be provided for four years from taxes paid on insurance
policies throughout the state.However, Barbour said at the bill signing that he was not sure how much of a break each policy holder could expect.

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The Australian residential
property market has slowed down, with demand for home finance falling
sharply under the combined impact of three rate hikes in 2006 and
deteriorating home loan affordability.

The Housing Industry
Association (HIA) said rising interest rates have dampened home
building activity and high land prices and regulatory costs are making
houses more unaffordable.

First home buyers have been most badly
affected by deteriorating affordability and higher interest rates, with
the share of all dwellings financed by first home buyers at 17.4 per
cent in September, compared with an historic average of 21.8 per cent.

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