The future of Fidelity Investments, the Boston mutual fund giant, is clouded because of the concentration of power in the hands of its 77-year-old chairman, Edward (Ned) Johnson 3rd, Moodys Investors Service warned.

Moodys said it had growing concerns about the control wielded by Johnson at Fidelitys parent company, FMR. Its board includes Johnson family members and longtime associates and no independent directors “whose presence would create some confidence that there is some check on Mr. Johnson,” Moodys wrote in a report Wednesday.

The New York rating agency left unchanged its rating on the debt and credit outlook of Fidelity, in which the founding Johnson family holds a 49 percent stake, though it noted that FMRs total debt had soared.

Moodys also cited increased competition in Fidelitys core mutual funds business and the low profit margins at its other businesses as issues facing one of the states major employers.

The comments give an institutional voice to questions others have raised lately about performance and governance practices at Fidelity, which Johnson has put into makeover mode this year following a period of lagging returns at its mutual funds.

Among other things this year, Johnson has replaced his No. 2 executive, reorganized its business units, and, most recently, transformed the structure of the Fidelity parent, FMR.

But the reclusive Johnson has yet to explain his thinking publicly or discuss questions like whether his 45-year-old daughter, Abigail Johnson, will follow him as leader of the company.

Moodys wrote that Fidelitys “lack of clarity” on the successor issue creates uncertainty that could hurt its efforts to attract new executives.

Moodys cited “significant market speculation” about whether Abigail Johnson “is the best possible person” to take over when her father steps down.

“These factors, to varying degrees, hamper FMRs ability to defend its position in an increasingly dynamic and complex industry,” Moodys wrote.

Johnson was not available to be interviewed Wednesday, said a Fidelity spokeswoman, Anne Crowley. He has declined numerous interview requests in the past.

“We disagree strongly with the majority of the views expressed in the report,” Crowley said. “The fact of the matter is that Mr. Johnson and the Fidelity board have succeeded over the years in creating one of the most successful and fast-growing financial services companies in the world.”

The company has no immediate plans to sell additional debt, she said.

(12-09) 09:14 PST BUENOS AIRES, Argentina (AP) —

Hugo Chavez and six other Latin American leaders are launching a regional development bank Sunday that the Venezuelan leader is touting as South America’s answer to U.S.-influenced international lenders.

With startup capital expected at up to $7 billion, backers say the Banco del Sur, or Bank of the South, will offer Latin American countries loans with fewer strings attached than those proffered by the World Bank, the International Monetary Fund or the Inter-American Development Bank.

“The Bank of the South is a strategy … aimed at freeing us from the chains of dependence and underdevelopment,” Chavez said upon arriving Sunday in the Argentine capital for the signing ceremony.

The bank is one of several far-reaching proposals under Chavez’s ambitious call to unite a bloc of Latin American countries in a “confederation of republics.” His vision also includes a transcontinental natural gas pipeline and trade alliances.

Critics note much remains to be determined about how the bank will operate. They say it might turn out to be a largely symbolic project used by Chavez to spread his oil-financed influence.

But others call the bank a bold stroke for Latin America’s financial independence.

“What you had in the past decade was the collapse of a very powerful creditor’s cartel headed by the IMF,” said Mark Weisbrot of the Washington-based Center for Economic and Policy Research. “This is the first step in creating an alternative.”

Finance ministers of Brazil, Venezuela, Bolivia, Uruguay, Paraguay, Argentina and Ecuador will sit on the bank’s board. Officials say it will dispense loans for projects ranging from road-building to anti-poverty programs and regional integration plans such as cross-border rail lines.

Rodolfo Sanz, a Venezuelan state bank official, said capitalization is expected between $5 billion and $7 billion Д depending on final pledges. Venezuelan officials say loans will be issued at interest rates similar to other international lenders.

“The bank is not against anything or anyone. It is in favor of the people of South America,” Venezuelan Finance Minister Rodrigo Cabezas said when Brazil, the largest economy in South American, committed to joining the enterprise.

He said the bank will seek to replace “traditional functions of the World Bank and International Monetary Fund in the region and their obsolete operating statutes.”

The bank will be headquartered in Caracas, with Bolivian and Argentine branches.

Augusto de la Torre, World Bank chief economist for Latin America, said the bank is welcome.

“It’s a very interesting initiative which I think expresses the desire to find stronger cooperation between Latin American governments,” he told The Associated Press in a recent interview. “As far as the World Bank is concerned, this new initiative is not perceived as a competitor.”

IMF-watcher Paul Blustein at Washington’s Brookings Institution said the project highlights Latin America’s yearning for greater autonomy after decades of sporadic financial crises and imposed austerity measures Д such as IMF missteps ahead of Argentina’s 2002 economic meltdown.

“It’s really emblematic of how Latin America has become disillusioned with the model that the IMF and the World Bank and the U.S. Treasury promotes Д the so-called Washington consensus,” he said.

But he noted the IMF and World Bank have decades of know-how.

“I’m not so sure this institution is going to be any more successful,” he said.

____

Associated Press writer Ian James in Caracas, Venezuela contributed to this report.

Google («www.businessweek.com») shares were up 10.48 to a new high of $620.10 after the company says it will reportedly begin showing YouTube videos on thousands of other Web sites, hoping to profit from adds attached to the clips, according to AP. Banc of America reportedly raises target price on Google to $670.

Miramar Mining («www.businessweek.com») agrees to be acquired by Newmont Mining («www.businessweek.com») in a deal valued at about C$1.5 billion. Terms: MNG holders to get C$6.25 per share.

Oxford Industries («www.businessweek.com») falls after the company posts first quarter EPS from continuing operations of $0.27, vs. $0.63 a year ago, on a 16% sales drop. It expects sales and EPS for the second quarter and the two-month period commencing Dec. 1, 2007 and ending Feb. 2, 2008 to be flat to slightly higher than last year.

California Pizza Kitchen («www.businessweek.com») posts 3.5% rise in third quarter comp-restaurant sales, vs. previous forecast of 2%-3% growth. It says, based upon 13.5% rise in third quarter revenue, aforementioned comp-restaurant sales results, $0.19 per share charge for store closure costs for four CPK/ASAPs previously announced, management expects EPS of $0.04-$0.05.

Children’s Place Retail Stores («www.businessweek.com») posts 3% higher September same-store sales, 4% higher total sales. It expects third quarter EPS to come in at least 60% below low end of previous guidance of $0.94-$1.02 (including charges). Assuming current sales and margin trends continue into the fourth quarter, the company thinks fiscal year 2008 EPS will be significantly below low end of previous guidance of $2.25-$2.40.

Thornburg Mortgage («www.businessweek.com») raises $863 million estimated aggregate third quarter loss resulting from asset sales to $1.099 billion.

American Electric Power («www.businessweek.com») reaches a settlement deal with the U.S. Environmental Protection Agency, eight states and 14 environmental organizations, bringing an end to alleged violations of the New Source Review (NSR) provisions of the Clean Air Act. AEP will install additional emissions control equipment, pay $60 million for environmental projects and a $15 million penalty.

Molson Coors Brewing («www.businessweek.com») and SABMiller PLC («www.businessweek.com») form a joint venture that will combine their U.S. operations. SABMiller will own 58%t in the venture and MolsonCoors will own 42% of the new company, MillerCoors.

Sprint Nextel («www.businessweek.com») says chairman, president and CEO Gary Forsee has stepped down, effective immediately. The company plans to search for a new CEO. It expects to report net loss of about 337,000 post-paid subscribers in the third quarter. It also sees adjusted OIBDA and consolidated operating revenue for ‘07 slightly below ranges previously provide. S&P keeps hold.

Yum Brands («www.businessweek.com») posts third quarter EPS of $0.50, vs. $0.42 a year ago, on 4.0% higher worldwide same-store sales. It raises 2007 EPS estimate to $1.65. It cites continued strong growth from China and YRI divisions. It sets additional $1.25 billion stock buyback plan. Yesterday, S&P reiterated buy ahead of its third quarter results.

AT&T («www.businessweek.com») has agreed to pay about $2.5 billion for wireless spectrum covering 196 million people from Aloha Partners LP, according to news reports. The spectrum covers 72 of the nation’s top 100 markets.

SLM («www.businessweek.com»), or Sallie Mae, sued to force the J.C.