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Greek prime minister’s government survives crucial confidence vote

ATHENS, Greece – The Greek prime minister survived a crucial confidence vote early Wednesday, keeping alive a government dedicated to averting a debt default that could spark a financial maelstrom around the world.

Lawmakers voted 155 to 143 along party lines to back Prime Minister George Papandreou, who now faces a critical vote next week on a massive austerity package that Greece’s international creditors have said must pass by the end of June.

He is seeking €28 billion ($40.24 billion) in budget cuts and new taxes and €50 billion worth of privatization of public assets. Unless the new measures pass, Greece will not receive the next batch of bailout funds, worth €12 billion, and will face a disastrous default in July, when it runs out of money.

A default by Greece could drag down Greek and European banks and renew fears over the finances of other eurozone countries such as Portugal, Ireland and Spain.

Papandreou must still convince all the lawmakers from his Socialist party to support the austerity bill, which has provoked strikes, riots and a slump in his popularity. While all 155 Socialists voted in favour of the confidence motion, several have publicly criticized the austerity measures and at least one has said he will not back them.

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After the vote, riot police fired tear gas and stun grenades to push back a group of about 200 protesters who had broken off from a main rally of several thousand to throw bottles and other objects at the police lines guarding Parliament.

“We will do everything in our power to end the state of insecurity Greek families face and exit this crisis in a safe way. We have a plan, we have prospects,” Papandreou said during a debate before his victory. “Regardless of the panic caused by some, we are on an organized course, helped by the international community with massive loans – the largest every given in the history of our planet.”

Papandreou’s government came to the brink of collapse last week as protesters rioted on the streets of Athens, two party rebels resigned their parliamentary seats and talks with the opposition conservatives over forming a pro-austerity coalition government fell apart. In response, he reshuffled his Cabinet, replaced his increasingly unpopular finance minister with a party heavyweight – his main internal rival – and called for the confidence vote.

European officials have been pressing opposition leader Antonis Samaras to back the austerity bill, which will run to 2015, two years beyond the current government’s mandate. But Samaras has insisted the thinking behind it is wrong, saying it is keeping Greece in a recession. He has called for a renegotiation of the initial bailout deal.

Papandreou’s losing the confidence vote would have likely led to early elections and thrown into question whether Greece could pass the new austerity measures. Expectations he would win lifted world markets earlier in the day.

After the vote, Asian stock markets, including Japan’s Nikkei 225 and Hong Kong’s Hang Seng, were higher in early trading Wednesday. Invesotrs were finding relief in what was viewed as a “crucial step toward stabilizing the whole debt situation,” said Ben Potter, a strategist with IG Markets in Melbourne, Australia.

“In summary, it looks like another broad-based rebound today as investor concerns ease over the European debt situation,” Potter said in a note to clients.

As the Greek deputies voted, several thousand protesters gathered outside Parliament chanting “Thieves! thieves!”, shining green laser lights at the parliament building and into the eyes of riot police protecting it. Continuing strikes by electricity company workers objecting to privatization caused a second day of rolling blackouts.

“I understand the anger, the fear, and the question whether we will make it,” Papandreou said. “My answer is that we have been making it every day for the last 20 months, with difficulties and mistakes, with a price to pay and with sacrifices but we are succeeding.”

Greece is being kept financially afloat by a €110 billion ($157 billion) package of bailout loans granted by other eurozone countries and the International Monetary Fund last year, and has implemented strict austerity measures in return, cutting public sector salaries and pensions, increasing taxes and overhauling its welfare system.

But the country has struggled to meet it targets, missing many, and is now in negotiations for a second bailout, which Papandreou has said will be roughly the same size as the first.

Officials from the IMF, European Commission and European Central Bank who have been overseeing Greece’s reforms were in Athens Wednesday to discuss the new austerity measures.

On Tuesday the new finance minister, Evangelos Venizelos, promised that parliament will pass the unpopular austerity package by the end of June.

“We must follow this course to save the country,” Venizelos said.

“Our European partners … face us with distrust,” he said. “This is an atmosphere that we have to change.”

Papandreou’s popularity has been hammered by the latest austerity measures, with an opinion poll published Tuesday giving the Socialists a 20.1 per cent approval rating. Rival conservatives fared marginally better, at 21 per cent, in the GPO survey for private Mega television of 1,000 adults. No margin of error was given.


Menelaos Hadjicostis, Demetris Nellas and AP photographers contributed to this report.

Toronto stock market advances after string of losses on Greek default worries

TORONTO – The Toronto stock market snapped a three-session losing streak Monday even as the possibility of a Greek default continued to cast a shadow over markets.

The S&P/TSX composite index gained 67.75 points to 12,857.7 with only the energy and tech sectors negative while the TSX Venture Exchange was 15.66 points lower to 1,882.27.

The Canadian dollar was unchanged from Friday at 102.02 cents US.

The greenback gained against other currencies, particularly the euro, as risk-averse traders bought into the American currency after a weekend meeting of eurozone finance ministers failed to agree on an immediate release of bailout funds to Greece.

Though the finance ministers of the 17 countries that use the euro agreed to hand over the next bailout instalment worth euro 12 billion (US$17 billion), they said they would only do that if the Greek Parliament backed further austerity measures.

But there is great uncertainty as to whether the Greek government can push through those new measures.

The financials sector was up 0.83 per cent with Manulife Financial (TSX:MFC) ahead 39 cents to $15.95.

Royal Bank (TSX:RY) shares were up 21 cents to $54.54 as it said it faces a $1.6-billion loss as it sheds its U.S. retail banking operations.

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Royal Bank is selling the U.S. assets to the PNC Financial Services Group Inc. for about US$3.62 billion. The loss includes an estimated $1.3 billion writeoff of the retail operations. Royal Bank will continue to operate both its U.S. wealth management and capital markets operations and its shares rose 21 cents to $54.54.

The telecom sector was up 1.63 per cent as the CRTC started six days of hearings into the ownership of media companies by national broadcasters. Rogers Communications (TSX:RCI.B) gained 62 cents to $35.97 while BCE Inc. (TSX:BCE) advanced 91 cents to $38.12.

The industrials sector rose 0.82 per cent with Canadian National Railways (TSX:CNR) ahead 75 cents to $74.16.

Bombardier Aerospace (TSX:BBD.B) has signed an unnamed “major network carrier” to take delivery of 10 of its new CSeries aircraft in a deal valued at $616 million. Its shares slipped six cents to $6.92.

The gold sector turned higher as nervous investors pushed bullion higher for a fifth day with the August gold contract in New York up $2.90 at US$1,542 an ounce. Goldcorp Inc. (TSX:G) ran up $1.04 to C$46.44.

Oil closed slightly higher with the July crude contract on the New York Mercantile Exchange up 25 cents at US$93.26 a barrel after a rising U.S. dollar earlier pushed oil as low as US$91.14. A stronger greenback usually helps depress oil prices, which are denominated in dollars, as it makes oil more expensive for holders of other currencies.

The energy sector backed off 0.38 per cent with Suncor Energy (TSX:SU) down 21 cents to C$36.96 and Imperial Oil (TSX:IMO) gave back 27 cents to $43.85.

The base metals sector was ahead 0.16 per cent as metal prices also retreated, with the July copper contract on the Nymex down three cents at US$4.07 a pound.

But the group was held back by sector heavyweight Teck Resources Ltd. (TSX:TCK.B). Its shares fell 43 cents to C$43.23 as the company reduced its coal production guidance for the second quarter and said unit mining costs would be greater as a result of higher labour and other expenses. Teck now expects coal sales in the second quarter at the low end of its previously announced guidance range of 5.5 million to six million tonnes as a result of the March 11 earthquake and tsunami in Japan.

Elsewhere in the sector, Quadra FNX Mining (TSX:QUX) gained 26 cents to $13.16.

Research In Motion Ltd. (TSX:RIM) continued to be a drag on the TSX following a disappointing earnings forecast delivered late last week. Its shares were down $1.83 or 6.72 per cent to $25.41 after plunging about 20 per cent Friday.

The positive performance on the TSX came after worries about Europe’s debt problems and the possibility of a Greek default in particular, along with slowing global economic conditions, pushed the TSX lower for a third week in a row, losing 2.2 per cent.

Greece has been at the centre of Europe’s debt worries, but other countries are also facing troubles. Moody’s warned on Friday that it may cut Italy’s credit rating because of its mounting debt and sluggish growth prospects.

In New York, the Dow Jones industrial average gained 76.02 points to 12,080.38.

The Nasdaq composite index rose 13.18 points to 2,629.66 while the S&P 500 index climbed 6.86 points to 1,278.36.

In other corporate news, beverage and specialty food maker Lassonde Industries Inc. (TSX:LAS.A) expects to have greater access to the large U.S. market with its US$390 million acquisition of New Jersey-based juice producer Clement Pappas and Co. Inc. Lassonde shares rose $1.35 to $70.35.

Boston-based Atlantic Power Corp. (TSX:ATP) announced Monday that it plans to acquire Capital Power Income L.P. (TSX:CPA.UN) in a cash and stock deal that values the company at some $1.1 billion. Atlantic Power shares dipped seven cents to $14.89 while Capital Power units gained 65 cents to $19.28.

Medical device maker Neovasc widens loss but raises revenues in latest quarter

VANCOUVER – Neovasc Inc. (TSXV:NVC), a Vancouver-based medical device maker, widened its net loss in the latest quarter on higher expenses.

The company reported Monday it lost $973,454 or two cents a share for the three months ended March 31.

That compared with a loss of $472,236 or two cents for the comparable period in 2010.

The loss reflected an increase of $99,683 in product development and clinical trial costs and a $410,036 rise in share-based compensation expenses.

Revenues increased 10 per cent year-over-year to $1.17 million from just under $1.1 million.

Meanwhile, total expenses rose to $1.4 million from $909,365.

“Neovasc continued to achieve good progress in all of our programs in the first three months of 2011, including our tissue products business, the Cosira trial of our Reducer product for refractory angina, and new program initiatives for treating mitral valve disease now underway,” said Alexei Marko, CEO of Neovasc.

“We reported solid revenue growth in our tissue products and services business, which was cash flow positive for the quarter, and we look forward to continued growth in this business as more of our customers’ devices progress towards commercialization.”

Neovasc is a specialty heart device company that develops, manufactures and markets medical devices for the vascular and surgical market.

The company’s current products include the Neovasc Reducer, used to treat refractory angina, as well as a line of advanced biological tissue technologies that are used in surgeries.

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Beatriz weakens to tropical storm after brushing Mexico’s Pacific coast

MANZANILLO, Mexico – Hurricane Beatriz weakened into a tropical storm and headed out to sea Tuesday after pounding Mexico’s resort-studded Pacific coast with heavy rains and winds.

The National Hurricane Center in Miami said Mexico’s government had discontinued a hurricane warning for a stretch of coastline from La Fortuna to Cabo Corrientes. Beatriz is expected to continue weakening over the next 48 hours.

Beatriz’s maximum sustained winds have dropped to near 60 mph (95 kph). It is about 110 miles (175 kilometres) south-southwest Cabo Corrientes and moving west into the Pacific at near 12 mph (19 kph).

Early Tuesday, Beatriz brushed Mexico’s Pacific coast as a hurricane forcing tourists from beaches and into hotels.

No injuries or major damage were reported in Manzanillo, said David Sanchez, Manzanillo’s civil protection director. He said authorities saw two palm trees that had been knocked over.

As of Tuesday afternoon, one Mexican tourist had been injured when a tree fell on him in Acapulco and a boy had gone missing after being swept by a current. Authorities closed the ports of Acapulco, Manzanillo and Zihuatanejo and urged hotel owners to tell guests not to go to the beach.

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A steady rain was falling in Manzanillo on Tuesday, but people were mostly going about their business with normal vehicle traffic in main avenues and people standing at bus stops.

In Manzanillo, many tourists were hanging out at the beach despite warnings not to.

Farther south along the coast in Zihuatanejo, civil protection officials ordered the port closed completely and authorized five shelters in case of floods or mudslides.

Some streets and avenues in the tourist district and downtown were flooded and city officials had to pick up fallen trees.

The Tides hotel advised its guests to remain in their rooms if possible and take precautions from rain and wind, receptionist Dulce Miranda said.

Still, tourists in Zihuatanejo were enjoying the waves on Tuesday.

“I came with my family, and they did not want to leave the bungalows that we rented… but the rain won’t stop me from wanting to at least wet my feet,” said Josefina Fernandez, a tourist of Mexico City.

In Acapulco, the ports were closed.

Authorities reported a 16-year-old boy was swept by the current and is still missing.

Tourist Arturo Olayo, of the city of Puebla, was injured when a tree fell on him. He was transported to the hospital. His condition was unknown.

About 150 Mexican soldiers were deployed on a rescue mission in case homes needed to be evacuated in Acapulco, the Mexican army said late Monday.

Authorities say 100 homes were flooded and 20 trees fell. A bridge suffered damages, and some avenues in the tourist district were also flooded because of the heavy rains. About 30 parked vehicles were swept by the current.


Associated Press writers Sergio Flores in Acapulco and Jonathan M. Katz and Adriana Gomez Licon in Mexico City contributed to this story.

Silence used to be golden at movies, but talking and texting are now the norm

LOS ANGELES, Calif. – It seems like such a quaint notion: Folks would go to the movie theatre, buy their tickets at the box office, then sit down, shut up and pay attention for two hours to what was on the screen.

Now, the piercing glow of cellphones lights up the darkness like so many pesky fireflies, and people talk to each other in a packed auditorium as if they were sitting in the privacy of their own living rooms.

The Alamo Drafthouse Cinema in Austin, Texas, did something about this trend by kicking out a patron who refused to adhere to the theatre’s rule against talking or texting, then turned the ranting, profane voice message she left into a hilarious public service announcement. It’s gotten over 1.75 million hits on YouTube in just a couple of weeks.

But what happened to our attention spans? Why must we talk, text and tweet in the middle of a movie? And what – if anything – can theatres do to stop this erosion of cinema civility?

Matt Atchity, editor-in-chief of the Rotten Tomatoes film review website, crafted “10 Commandments for Movie Audiences” including “Thou shalt not text.” But the ubiquity of cellphones makes these sensible suggestions hard to enforce.

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“Even 10 years ago, not everyone had a phone, not everyone was text messaging. The younger generation grew up and the kids who were texting in class are now the kids who are texting in movies,” Atchity said.

He added that Hollywood’s focus on the 18-24 demographic is also a factor. “A big opening release is like going to Chuck E. Cheese,” Atchity said.

While adults might believe what’s on screen deserves their full attention, kids nowadays view the movie-going experience as interactive, said Bill Goodykoontz, film critic for The Arizona Republic and father of four.

“They can’t imagine seeing anything, including a movie, without immediately supplying their reactions,” said Goodykoontz, who’s also chief film critic for Gannett.

Producer Barry Mendel (“Bridesmaids”) believes the reliance on social media and 24-7 information has bled into every part of our lives – even places that are meant to provide an escape.

“It’s very rare in our society to sit and stare at something intensely and without distraction for two hours. People just don’t have that muscle anymore,” said Mendel, a two-time Oscar nominee for best picture for “The Sixth Sense” and “Munich.”

“It makes me worry for my profession, for making movies,” he continued. “In order for a movie to be good, someone needs to sit down and read a screenplay and help the writer make it better. Instead they start reading a script, then they stop reading it and pick it up later.”

Rachael Harris (“The Hangover,” ”Diary of a Wimpy Kid”) said a guy recently walked in late to a private screening of the new independent film she stars in, “Natural Selection,” sat down next to her and immediately checked his BlackBerry.

“As an actor, you do have a sense of: ‘How dare I not be riveting enough that you have to check your email?’ You react personally but then you realize it’s not personal. It’s just bad manners,” she said.

But many of the young people who engage in these practices don’t think it’s a problem because everyone does it. Thirteen-year-old Will Barnes of Frisco, Texas, says he texts sometimes during movies, but tries to be courteous.

“I didn’t really like ‘Thor,’ so I just pulled out my phone and texted a little bit. It was during the day so nobody was really in the theatre at the time,” Barnes said. “I’m just looking at the screen, I’m not paying attention to what other people are doing. But you see adults doing it and I think it’s a little immature for their age to be texting during a movie.”

Fourteen-year-old Andrea Lopez of Newhall, Calif., says she leaves her phone on during movies but keeps it on silent: “Normally I’ll just text during the end of the movie to have my mom or dad come pick me up.”

But when others are blatantly using their phones, Lopez said, “that’s ridiculous. Then they’re just ruining the movie for everyone else. The least they can do is go outside and talk.”

But not all offenders are adolescents: “I am the worst. It annoys my kids,” said Tracy Tofte, a 40-year-old real estate agent and mother of two in Santa Clarita, Calif. “If it’s a slow part of the movie I can’t help looking at my phone and going, ‘Oh, I have an email.’”

Theater owners have tried a variety of methods to get folks to keep quiet and stay off their phones, from showing amusing messages beforehand to having ushers sweep through the auditorium during the show, said John Fithian, president of the National Association of Theatre Owners. Some have experimented with dividing moviegoers into over-21 and under-21 auditoriums, but that can get disorganized.

“It’s an educational process but we and our members and the people who write about our industry know that the beauty of cinema, first of all, is that it’s a shared experience. That means there are shared responsibilities,” said Fithian.

With the expansion of the international movie market, mobile phone etiquette has also become an issue in overseas theatres.

Before a movie starts in India, warnings flash on the screen asking people to switch off their phones or put them on silent, yet some folks continue to chat anyway and theatre workers don’t kick them out.

Compliance is far better in Hong Kong, where patrons generally heed a message urging them to turn off or silence their phones before the movie.

In Britain, peer pressure usually keeps theatres quiet. Moviegoers are familiar with a long-running series of ads shown beforehand under the slogan: “Don’t Let a Mobile Phone Ruin Your Movie.” The comic promos feature well-known actors having their movie projects destroyed by a clueless mobile phone executive.

Theatres in China range from plush auditoriums in large cities to basic theatres in smaller towns that may even lack concession stands. So the demographic of moviegoers tends to vary, too, along with their attention to etiquette, with audiences in the higher-end theatres typically more compliant.

Around 2004, the National Association of Theatre Owners investigated technology that would block cellphone signals in U.S. theatres. When word of that got out, responses came flooding in, said Fithian, the NATO president.

Sixty per cent were in favour of the idea, with 40 per cent against it, “but the 40 per cent was violent,” he said. “Parents have to stay in touch with their babysitters. People are so focused on how important their jobs are that they had to be in touch 24/7. I felt like asking these people, ‘What did you do 15 years ago?’”


Associated Press writers Jill Lawless in London, Min Lee in Hong Kong, Ashok Sharma in New Delhi and Chi-Chi Zhang in Beijing contributed to this report.



Alamo Drafthouse PSA: 杭州桑拿按摩论坛杭州夜生活youtube杭州夜网/watch?v=1L3eeC2lJZs&feature=related

Rotten Tomatoes 10 Commandments: 杭州桑拿按摩论坛杭州夜生活rottentomatoes杭州夜网/m/1021015-ten_commandments/news/1922953/ten_commandments_for_movie_audiences/

As Villas-Boas is linked to Chelsea, club says it hopes to announce new manager in coming days

LISBON, Portugal – Chelsea announced plans Monday to appoint a new manager within days, after Portuguese media linked Porto’s Andre Villas-Boas with the Premier League club.

Portugal’s national news agency Lusa and several Portuguese newspaper websites reported that Chelsea has agreed to pay the 15-milion-euro (C$21 million) release clause in Villas-Boas’s Porto contract.

“We hope to be able to make an announcement regarding the new manager in the next few days,” Chelsea said in a statement responding to questions about Villas-Boas.

Porto said it has “received no information that the clause will be activated nor the coach’s willingness for it to happen.”

But Porto President Jorge Pinto da Costa said he would be powerless to prevent the 33-year-old Villas-Boas leaving if the price is met to release him from a contract that runs until 2013.

“If someone puts 15 million euros into our bank account and he wants to leave, there’s nothing we can do about it because that’s the contractual undertaking,” Pinto da Costa told Portugal’s Sport TV. “If that doesn’t happen, he won’t leave.”

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Villas-Boas would be replacing Italian Carlo Ancelotti, who was fired last month after his second season at Chelsea ended without a trophy.

And at 33, the Portuguese is the same age as Chelsea players Frank Lampard and Didier Drogba who he worked with at Stamford Bridge under compatriot Jose Mourinho.

Comparisons with Mourinho were reinforced last month when Villas-Boas emulated his compatriot by winning the same European competition that launched the career of the self-styled “Special One.”

Villas-Boas became the youngest coach to win a UEFA club competition when Porto’s unbeaten season ended with a victory in the Europa League final, eight years after Mourinho won the competition in its UEFA Cup incarnation.

After Mourinho, who now coaches Real Madrid, moved from Porto to Chelsea in 2004 he won back-to-back Premier League titles.

Villas-Boas was a scout for Mourinho at Chelsea and followed him in 2008 to Inter Milan.

Villas-Boas, who speaks fluent English, had also worked with Bobby Robson during the English coach’s spell at Porto’s Stadium of the Dragon. He coached the British Virgin Isles at just 21.

Porto ended the past season unbeaten in the domestic championship with 27 wins in 30 matches. In Europe, it recorded 14 wins in 17 games, scoring 44 goals with an attacking style of play favoured by Villas-Boas.

Porto became only the second Portuguese club to finish a league season unbeaten, after Benfica’s 1972-73 team.

“I don’t approach football with only a tactical approach – you can achieve success through various means. What I like is to make my players give their most but I give them lots of room to manoeuvre,” Villas-Boas said on the eve of the Europa League final. “I try to promote their talent and feel free to make the right decisions. I’m no dictator.”

Dutch coach Guus Hiddink was also linked with a return to the Blues, where he won the FA Cup as a caretaker manager in 2009.

Boyd Group acquires Colorado-based collision repair company

WINNIPEG – Boyd Group Income Fund (TSX:BYD.UN) has entered into a definitive agreement to acquire Cars Collision Center of Colorado LLC, which owns 28 collision repair shops in the U.S. states of Illinois, Indiana, and Colorado.

The pricetag of the deal, announced Monday, is US$21 million.

The Winnipeg-based auto body repair company said the acquisition is expected to immediately boost earnings, cash flows and distributable cash per unit.

“By our estimates, the acquisition will position Boyd as the largest multi-location collision operator in North America not only in terms of number of locations, but also in terms of annual sales,” president and CEO Brock Bulbuck said in a release before stock markets opened Monday.

“After completing this transaction, Boyd will have a total of 164 collision repair centres across 13 U.S. states and four Canadian provinces. We expect to see substantial benefits from the transaction, including expanded critical mass and presence in one of our key markets, an expanded national footprint which translates into enhanced value to our U.S. insurance company clients, as well as additional synergies.”

The transaction is expected to be completed by July 1.

Cars is a private company that operates 14 locations in Illinois, eight in northern Indiana, and six shops in Colorado. It generated sales of US$65 million in the 12 months ended April 30.

The Boyd Group is the largest operator of collision repair centres in North America, operating under the trade names Boyd Autobody & Glass, Gerber Collision & Glass and True2Form.

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Austrian officials extradite to Germany terror suspect arrested in Vienna

BERLIN – An alleged German terrorist arrested last month in Vienna has been extradited to Germany, where authorities accuse him of belonging to the extremist German Taliban Mujahideen movement.

German federal prosecutors said the 26-year-old, identified only as Yusuf O., was arrested in Vienna on May 31 on a German warrant. He was taken to Germany on Monday and brought before a judge, who ordered that he remain in custody pending further investigation.

The suspect allegedly travelled to the Afghan-Pakistan border region in 2009 and joined the German Taliban Mujahideen by that September, prosecutors say.

“He is believed to have been trained in explosives and guns and have participated in the violent jihad of the German Taliban Mujahideen,” they said in a statement that also alleged he “appeared in propaganda videos of the organization.”

Upon his return to Europe in 2011, O. began recruiting supporters and members for the movement, including another suspect identified as 21-year-old Austrian Maqsood L., who was arrested on May 16 in Berlin.

Austrian Interior Ministry spokesman Rudolf Gollia also said Monday that Yusuf O. was in contact with another Austrian suspect, 25-year-old Thomas al-J., who was arrested in Vienna last week.

Austrian officials say they are investigating al-J. for planning plotting attacks in Germany, including vague plans to target the seat of Germany’s parliament, the Reichstag in Berlin.

Germany’s Interior Ministry said it had knowledge of plans for any such attack.

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Tens of thousands demonstrate Yemen’s capital, demand president’s sons leave country

SANAA, Yemen – Tens of thousands took to the streets of the capital on Monday, demanding that the president’s sons leave Yemen as pressure rose for the wounded leader being treated outside the country to step down.

Ahmed Saleh, 42, is a one-time heir apparent to his father, who was badly wounded in an attack earlier this month. A ruling party official had said last week the president would return home soon from medical treatment in Saudi Arabia despite reports that he was heavily burned.

In his absence, pressure has been mounting at home and abroad for President Ali Abdullah Saleh to step aside after nearly 33 years in power.

His son Ahmed Saleh commands the elite Presidential Guard, the country’s best equipped and trained military unit. The force has played a key role in protecting his father’s regime since pro-democracy protests erupted in February.

The protesters on Monday called for Ahmed Saleh to leave, along with his brother Khaled, who is also an army commander. Their demonstration led to the closure of major streets in the capital. Most stores shuttered down, but there were no immediate reports of clashes with security forces.

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More than 100 influential religious clerics and tribal leaders have called for the president’s ouster and elections to choose a new leader, saying he is unfit to return to his post.

Militants, meanwhile, are taking advantage of the internal strife in Yemen to overrun parts of the country.

In the southern port of Aden, government forces early Monday killed one Islamic militant and wounded two others in an exchange of fire near the offices of the local branch of the Central bank at Crater, the city’s ancient historic port district, according to security officials. No casualties were reported.

Militants also seized two towns in the southern province of Abyan late last month and attacked a town in a neighbouring province last week.

Military officials, meanwhile, on Monday raised to 17 the number of militants killed in fighting in Abyan the previous day and said at least five soldiers, including two senior officers, were killed Monday when a mortar hit their position.

The security and military officials spoke on condition of anonymity because they were not authorized to speak to the media.

Yemen’s political turmoil began with anti-government protests in February. The country is the poorest in the Arab world, suffers numerous internal conflicts and is a potential source of instability for neighbouring Saudi Arabia and other oil-rich parts of the Arabian peninsula.

For the U.S. and Europe, the main concern is the al-Qaida offshoot that has found refuge in Yemen’s mountainous hinterlands and has been behind several nearly successful strikes on U.S. targets.

Royal Bank sells U.S. retail banking operations for US$3.62 billion

TORONTO – Royal Bank (TSX:RY) has agreed to sell its U.S. regional retail banking operations to PNC Financial Services for about US$3.62 billion and will take well over a billion dollars in losses as a result.

Canada’s biggest bank said Monday that it will face a C$1.6-billion loss that will be booked in the third quarter, which ends July 31. The loss includes an estimated $1.3-billion writeoff.

Royal Bank said the purchase will be comprised of cash as well as up to $1 billion in PNC shares.

Chief executive Gord Nixon told analysts on a conference call that Royal Bank weighed several different types of transactions but settled on PNC’s offer because it preferred the balance of cash and shares in the agreement.

“Specifically, the additional capital can be used to fuel organic growth across all of our business segments and invest in other businesses, such as wealth management, where we have been targeting some international asset managers,” Nixon said.

The transaction covers its RBC Bank operations, which will be sold for US$3.45 billion, and its credit card assets, sold for US$165 million.

Royal Bank operates under the RBC Bank banner in the U.S., with more than 400 branches throughout North Carolina, South Carolina, Virginia, Georgia, Florida and Alabama.

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The banks were formerly part of the Centura and other brands that were acquired by Royal starting a decade ago. However, the Canadian bank’s rapid expansion struck a major hurdle when the U.S. housing bubble burst and hit mortgage markets hard in southern U.S. states where the former Centura bank operated.

“Given the dynamics and highly competitive nature of the U.S. retail market and the increasing challenges as a result of both the economy and regulations, success in our view will require operational scale which can only be achieved by making large capital investments,” Nixon said.

“We believe we can achieve greater shareholder returns by investing the proceeds of this sale into higher return businesses.”

Nixon emphasized that the transaction doesn’t mean Royal Bank is fully exiting the United States, as it plans to continue operating both its U.S. wealth management and capital markets operations.

“In addition, we will maintain our existing cross-border banking platform for current and future clients with a targeted suite of cross-border products and services to meet their needs,” Nixon said in a release before stock markets opened.

Investors appeared to respond relatively favourably to the transaction, sending Royal’s shares up 22 cents to $54.55 in morning trading Monday on the Toronto Stock Exchange.

“I think there’s relief that it’s over and it didn’t take a long time” to sell the assets, said Kate Warne, Canadian markets specialist at Edward Jones in St. Louis.

“To a certain extent, buying banks that did a lot of real estate loans at the beginning of the real estate crisis wasn’t a great move and we can at least be relieved that they have gotten out of them.”

CIBC analyst Rob Sedran said in as note that despite Royal Bank booking a loss on the sale, the financial implications are positive.

“The deal should … be viewed favourably since Royal Bank was able, in our view, to extract a very full price. Management can now refocus on growing its core business and the deal will be accretive to both earnings and capital,” he wrote.

Despite the Royal’s troubles in the United States, other Canadian banks – TD Bank and Bank of Montreal – are doing well in the American market.

TD’s former Banknorth and Commerce Bank franchises – renamed as TD Bank N.A – are among the biggest regional banks in the United States, operating throughout New England and the northeastern states. Meanwhile, Bank of Montreal has a growing banking and wealth management franchise from its Harris Bank operations based in the Chicago area.

The sale of the banking assets face the usual closing conditions, including regulatory approvals, and the transaction is expected to close in March 2012.

A Wall Street Journal report on Sunday said that Pittsburgh-based PNC beat out rival regional bank BB&T Corp. for the Royal Bank operations.

PNC chairman and CEO James Rohr said in a statement that the RBC acquisition will give PNC access to “attractive southeast markets in a way that will create value for our shareholders.”

The deal adds about $19 billion of deposits and $16 billion of loans based on RBC Bank (USA) balances as of April 30, Rohr said.