22/08/2014 Asia Business Report

BBC News, all the latest business news live from Singapore. Bank of

America is hit with a near $17 billion fine by US authorities for

misleading customers. Australia's Trade Minister is forced to reassure

the country's biggest trading partner. Thank you for joining us

for this edition of Asia Business Report. I am Rico Hizon. It is the

highest fine a single company has ever agreed to with regulators. The

Bank of America is paying US authorities close to $17 billion to

settle claims that it and its affiliates misled investors by

pretending risky mortgage securities were safe. The settlement will cut

its third`quarter profits by more than $5 billion. Michelle Fleury

reports from New York. Bad mortgage investments devastated the US

housing market, and sparked a depression the economy is only now

just shaking off. Now another bank has been punished for those

investments with a huge fine. Bank of America is paying $17 billion,

substantially more than rivals JP Morgan and Citigroup paid to settle

a similar matter. In a statement, the bank's chief executive Brian

Moynihan said the deal was in the best interests of its shareholders.

This settlement brings a measure of closure to the bank which has been

dogged by legal problems ever since the start of financial crisis. A

large portion of the penalty will go towards modifying the mortgages of

borrowers who owe more than their homes are worth, the rest will go to

the authorities. US Attorney General Eric Holder emphasised the severity

of the punishment. This constitutes the largest civil settlement with a

single entity in history, addressing conduct uncovered in more than a

dozen cases and investigations. I want to be very clear, the size and

scope of this multibillion`dollar agreement goes far beyond the cost

of doing business. This outcome does not preclude any criminal charges

against the bank or its employees. The penalty exceeds Bank of

America's entire profits last year. But many still think such fines are

not enough of a punishment for the people and companies that did such

damage to the global economy. In other news, clothing giant Gap says

it plans to open 40 stores in India next year. The announcement came

after the company unveiled second`quarter results, which showed

net sales increasing by 3% to under just $4 billion. The move into

India, from where it has sourced products for many years, is part of

the company's strategy to expand operations in Asia, including China,

Hong Kong and Taiwan. Toyota has cut its prices in China, reducing it in

certain models by an average of 26%. The Lexus model parts were reduced.

The price cuts follow a $200 million fine issued by China against 12

Japanese companies over price manipulation. The mainland

government is in the middle of conducting investigations in the

country's automotive sector. Australia's biggest trading partner

is China. So when a Member of Parliament goes on national

television and describes the Chinese as mongrels who shoot their own

people, it has the makings of a major trade dispute. Clive Palmer,

who also happens to be one of Australia's richest men, has left

the Australian government trying to limit the damage. As it tries to

conclude free`trade arrangement with Beijing. Australia's Trade Minister

Andrew Robb spoke to our correspondent. It is distinctly

unhelpful. There was a statement yesterday afternoon where the

Chinese government officially said that they do not think it in any way

reflects the views of the government or the community in Australia. So

that is a welcome sign. But, nevertheless, comments by someone in

his position, to say these things, is extraordinarily unhelpful. I

think it can be misinterpreted and can colour the attitude of people we

are negotiating with. We've been ten years, trying to bring the

negotiation to this stage, for a free`trade agreement between the two

countries. Exactly. Ten years, our biggest trading partner. It would

materially advantaged the Australian community. In the end, hundreds of

thousands of jobs could be created with a free trade agreement. These

things are very important, and he has done potential damage to the

prosperity and the prospects of millions of Australians. So do you

think Clive Palmer's words might be able to be measured in terms of

dollars lost? Well, I'm hopeful that we will be able to work through this

and go beyond it, and the Chinese won't hold it against us. But, you

know, we shouldn't be in this position in the first place. We

shouldn't have to be wondering whether it's going to have the

material and permanent impact. But Australia is a robust democracy. We

are. But he is a senior Member of Parliament and one of Australia's

wealthiest men. He stood for Parliament, saying people should

trust him to look after their interests. This in no way, in my

view, looks after the interests of the Australian people. It's an

attempt to look after his own business interests. That was Andrew

Robb, Australia's Minister for trade. Argentina's plan to exit its

debt default has been ruled illegal. The struggling South American nation

wanted investors holding defaulted loans to swap them for new locally

issued debt. A judge in New York said the plan was lawlessl. ``

Lawless. Argentina had been trying to get around an earlier court

ruling, banning it from paying interest to investors who accepted

restructured bonds. Russia has announced an unscheduled tax on

McDonald's restaurants across the country, as part of an investigation

into food standards. The move comes after Russia's top watchdog

temporarily shut down four of the fast food restaurant in Moscow. This

comes amid rising tensions and sanctions between Russia and the

West over the Ukraine crisis. Earlier this year, at the EU banned

imports of mangoes from India after the discovery of insects which

authorities said threatened crops. That created a gap in the market

which growers around the region have been quick to fill, but not without

some challenges. Our correspondent reports from the Pakistani capital

Islamabad. After Europe's India mango band kicked in, it was these

businesses which started to suffer `` ban. It had agreed to buy the

fruit from farmers, and so had to find new customers for mangoes it

couldn't sell to the EU. Some went abroad, but most of the surplus was

sold in India, many prices fell. For India's mango farmers, it is

worrying, especially if it continues. But of course, India is

not the only country in this region to grow mangoes. This farm is on the

outskirts of a city in Pakistan. Every summer, the fruit grown here

is piled high in local markets. But some get sold abroad. Pakistan is

the eighth biggest exporter of mangoes and world. It is always on

the lookout for new customers. The European ban is due to last until

2015. That hasn't stopped some exporters looking to take advantage

of this opportunity, getting short`term sales now and perhaps

giving new customers something to think about. This man buys mangoes

and exports them. His biggest markets are Asian countries. At this

year he got his first ever order from the EU. TRANSLATION: A company

in Ireland placed an order. In one week they wanted 1500 kg, it was of

the ban on Indian mangoes. It is something we in Pakistan can

definitely take advantage of. Pakistan already sells mangoes to

the EU. And the India ban means total exports are at set to increase

in 2014. But pests like fruit flies have caused problems in Pakistan as

well over the years. There is a ban on sales to the US and Japan as a

result. Foreign donors have been working with the government to try

and improve standards, giving tutorials and introducing new

technology. There is some national pride over mangoes across this

region. Whether you are from India, Pakistan, or other growers like

anger that true languor, it will tell you that their mangoes taste

test `` Sri Lanka. With the band possibly lifted in time for the next

mango season, customers in Europe may be once again having the same

argument `` ban. You can catch more on that and other business stories

from south Asia on India Business Report this weekend. Before we go, a

look at the markets. Asian stocks are trading higher in mid`morning

Friday trade due to gains in US equities. Leading the way forward is

Indonesia, now soaring to fresh record highs as the country's top

court rejected an appeal by the losing candidate in last month's

presidential election over alleged voting irregularities. This removes

any uncertainty around the victory which is currently moving the main

share index in Jakarta well past positive territory. Regional

investors are also keenly awaiting this beach of Fed chief Janet Yellen

today `` the speech. Those are the Asian markets. Thank you for

investing your time with us. I am Rico Hizon. Goodbye for now. The top

stories this hour: The United States says the group calling itself the

Islamic State presents a long`term threat ` greater than any other so

far, and that it must be defeated in Syria as well as Iraq. A hospital in

the United States has discharged two American missionaries it was

treating for the ebola virus, saying they pose