Business news digest

OHIO

Ohio doesn’t tap into loan from federal government

COLUMBUS — Ohio says it has made it through December without needing a $50 million loan from the federal government to shore up the state unemployment compensation fund. The state still plans to borrow $500 million in January and February to ensure unemployed workers in Ohio will continue to receive benefits.

The state’s unemployment benefits fund is facing a spike in claims at the same time it’s seeing a drop in revenue collected through taxes on businesses.

The fund currently holds about $130 million, far below what the state regards as the minimum safe level of about $2.5 billion. The state must repay the money with interest.

NATION

Automakers shares tumble as bailout sinks in

NEW YORK — Washington’s emergency loan program won’t provide much of a lifeline for holders of General Motors Corp. shares, Wall Street analysts said.

The bearish reports, which warned that the measures called for in the loan program would severely dilute existing GM shares, sent GM’s stock sharply lower.

Buckingham Research auto analyst Joseph Amaturo said the $17.4 billion loan program approved by the White House is likely to diminish the value of GM stock in the long term as the company restructures and the government takes a stake.

Amaturo reiterated a $1 price target on GM. The price target implies an expected 72 percent drop in value for GM’s Monday close of $3.52.

Circuit City receives approval for financing

RICHMOND, Va. — Circuit City Stores Inc. on Monday received final approval for $1.1 billion in financing to keep operating while the nation’s second-biggest electronics retailer is in Chapter 11 bankruptcy protection.

U.S. Bankruptcy Judge Kevin Huennekens approved the debtor-in-possession loans at a hearing in Richmond. The financing will be used to stock merchandise and pay employees.

Richmond, Va.-based Circuit City filed for bankruptcy protection last month.

Associated Press