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Business News Roundup, April 21
April 20, 2017
Visa’s profit dropped 75 percent in the fiscal second quarter from a year ago, largely due to the costs of integrating its recently acquired Visa Europe into the larger company. Visa had two significant one-time charges related to the reorganization of the company to include Visa Europe, which Visa Inc. purchased last year. Excluding those items, Visa had an adjusted profit of $2.1 billion (86 cents), which beat analysts’ expectations. The company continues to benefit from the increased adoption of plastic as a method of payment across the globe. The amount processed on Visa’s network is closely watched by investors since the company charges a fee to a merchant each time a customer uses a Visa credit or debit card. Visa processed $1.73 trillion on its credit and debit card network in the quarter, up 37 percent from a year earlier, but that increase includes the processing business of Visa Europe as well. Visa last year became the credit card processing company for Costco, taking that business away from American Express. Unilever, the giant food and consumer product company, is buying Sir Kensington’s, a small condiment maker that has muscled its way on to grocery store shelves long thought impervious to upstart entrants. In the intervening months, Unilever has announced that it is selling its spread business, which includes Country Crock and I Can’t Believe It’s Not Butter, as well as some baking lines, leading some to speculate that it might get out of food sales altogether. The average U.S. mortgage rate fell below a key threshold of 4 percent this week, its lowest level in five months. Mortgage buyer Freddie Mac said Thursday that the average interest rate on 30-year fixed-rate loans declined to 3.97 percent this week from 4.08 percent last week. More people sought unemployment benefits last week, yet applications remained at a historically low level that suggests workers have solid job security.