Business news with words bank+billion+phone. 6 news.

LONDON (MarketWatch) -- Mervyn King, governor of the Bank of England, told a Treasury committee meeting that there never was a firm Lloyds TSB proposal to buy Northern Rock before the bank was forced to take emergency Bank of England support. He said there was "a vague phone call" in which Lloyds TSB wanted 30 billion pounds of funding for a few years at no penalty rate. King said he was of the view such a loan would be akin to state aid barred by the European Commission.

WASHINGTON (MarketWatch) -- The Federal Reserve on Friday released details Friday of the first auction under its newly created auction facility. The Fed will offer on Dec. 17 $20 billion in a 28-day loan. The minimum bid amount is $10 million. The minimum bid rate is 4.17%. The maximum award is $2 billion, or 10% of the offering amount. Participants must submit bids by phone to their local Reserve Bank between 10:00 a.m. and 1:00 p.m. ET on Monday. The auction results will be announced on Dec. 19 at 10:00 a.m. The auction is an innovative attempt by the Fed and global central banks to inject dollar liquidity into the financial system. The auction is designed to lower inter-bank lending rates or at least put a cap on them. Inter-bank rates have been trading well above normal in recent weeks in the second bout of financial turmoil since the summer.

DEUTSCHE Telekom AG, Europe's biggest phone company, rose in German trading yesterday after the former monopoly unexpectedly said it will increase its dividend for the first time in two years. Deutsche Telekom gained 1.7 percent on the Frankfurt exchange. The payout will jump to 3.4 billion euros (US$5 billion), or 78 cents a share, for 2007, from 3.1 billion euros, or 72 cents, a year earlier, Chief Financial Officer Karl-Gerhard Eick told Bloomberg News late Thursday. The increase underscores Chief Executive Officer Rene Obermann's efforts to boost the attractiveness of Bonn-based Deutsche Telekom's stock, which has lagged behind Telefonica SA and Vodafone Group Plc. This week, France Telecom SA said it won't raise the portion of cash flow budgeted as dividends, and its stock fell 4.2 percent in one day. Dexia Bank NV analyst Rob Goyens said he will keep his "add" rating on Deutsche Telekom stock and increase his price estimate. "It's a nice

BANK of China Ltd's Hong Kong unit said its purchase of a 4.9 percent stake in Bank of East Asia Ltd, the city's third-largest bank, doesn't presage a takeover. BOC Hong Kong (Holdings) Ltd, 65.8 percent owned by China's second-largest bank, yesterday announced it paid HK$3.95 billion ($507 million) for the holding, calling it a "financial investment." "At this point in time, we don't contemplate any further transaction which involves Bank of East Asia," BOC Hong Kong spokeswoman Clarina Man said in a phone interview yesterday. Yesterday's announcement surprised some analysts, who were expecting an overseas lender to target Bank of East Asia to get access to its growing branch network in China, Bloomberg News reported. La Caixa, Spain's largest savings bank, holds a 4.2 percent stake in the company. "Bank of East Asia has always been talked about as a possible target for a foreign bank to take over as a fast way to get into China and Hong Kong,"

CHINA Life Insurance Co yesterday surpassed AT&T Inc in market value, giving China five of the world's 10 largest companies, compared to three for the United States. Beijing-based China Life, the nation's largest insurer, gained 1.1 percent in Hong Kong and added 6.7 percent in Shanghai yesterday ahead of its third-quarter earnings announcement, valuing the company at 1.94 trillion yuan (US$259.1 billion). San Antonio-based AT&T, the biggest US phone company, is valued at US$252.9 billion, according to Bloomberg News. "China is one of the most exciting economies," said Jim Rogers, the chairman of New York-based Beeland Interests Inc. "The market is willing to pay a lot more for future growth." China Life, PetroChina Co, China Mobile Ltd, Industrial and Commercial Bank of China Ltd and China Petroleum and Chemical Corp are now in the list of the world's 10 biggest companies by market value. Only two of those are in the top 50 by sales. The CSI 300 Index,

THE Philippine central bank is proposing the government reduce plans to borrow US$1 billion overseas next year to stem gains in the peso, Asia's best-performing currency in the past three months. The government can consider "more domestic borrowings" instead, Bangko Sentral ng Pilipinas Governor Amando Tetangco said in a phone interview yesterday. The government may reduce overseas sales, which would mean less foreign currency needs to be converted, Finance Secretary Gary Teves said in a statement. It won't scrap 2008 foreign borrowings, he said. The peso has climbed five percent against the US dollar in the past three months as economic growth accelerated and stocks rallied. A stronger peso has made Philippine goods less competitive, Bloomberg News said. "It's the right thing to do," said Irene Cheung, Singapore-based strategist at ABN Amro NV. "The fact they are doing this is a response to the strength of the peso and it shouldn't be seen as a