(02-29) 09:34 PST Columbus, Ohio (AP) —

Victoria’s Secret, the lingerie company that introduced the Very Sexy bra, the Fantasy Bra, and the Internet server-crashing fashion show, has become “too sexy” for its own good, its top executive said.

“We’ve so much gotten off our heritage … too sexy, and we use the word sexy a lot and really have forgotten the ultra feminine,” said Sharen Turney, Victoria’s Secret’s chief executive, in a call with industry analysts.

Victoria’s Secret was launched with the idea that Victoria was manor-born and lived in London, Turney said.

“I feel so strongly about us getting back to our heritage and really thinking in terms of ultra feminine and not just the word sexy and becoming much more relevant to our customer,” Turney said Thursday.

Turney said Victoria’s Secret has gotten younger with a strong focus on its successful Pink line of lingerie and loungewear created for college-age women, and has tried to chase those customers

Turney said Victoria’s Secret wants to increase its level of sophistication.

“We will also reinvent the sleepwear business and focus on product quality,” she said. “Our assortment will return to an ultra feminine lingerie brand to meet her needs and expectation.”

Sales at Victoria’s Secret, like many clothing retailers, have been slipping.

Victoria Secret’s parent, Limited Brands, said Wednesday that its fourth quarter profits fell 12 percent and that its first quarter earnings would come in below Wall Street expectations.

Same-store sales at Victoria’s Secret fell 2 percent in 2007, with sales in the fourth quarter dropping 8 percent.

The chain was started in San Francisco in 1977 by Roy Raymond, who said he was embarrassed trying to buy lingerie for his wife and hoped to provide a comfortable place for men to shop.

HONG KONG: As the Hong Kong dollar has slumped to record lows because of its peg to the U.S. dollar and as savings rates have been slashed to zero, Arleta Chen has been shifting money into a Chinese-currency bank account.

For Hong Kong residents like Chen, a semi-retired management consultant, the allure of a yuan bank account is not the interest rate, which is low at less than 1 percent.

Instead, they are looking for currency appreciation as Chinas central bank allows the yuan to rise against the U.S. dollar, and hence the Hong Kong dollar, to help combat inflation.

A Reuters poll forecast that the yuan would rise 11 percent against the U.S. dollar this year, an increase that could help offset the impact of inflation in Hong Kong, which has doubled in the past few months to 6.3 percent, a 10-year high.

“The yuan is appreciating, so rather than put money in Hong Kong dollar accounts, which are yielding negligible interest, Im putting it in a currency that would help me hedge against inflation,” said Chen, who is 52.

She is not alone. Deposits in Chinese-currency accounts at Hong Kong banks have soared more than 40 percent this year, totaling 47.8 billion yuan, or about $6.8 billion, by the end of February, as Hong Kong residents have sought to preserve their wealth.

The yuans availability in Hong Kong reflects growing integration with Chinas booming economy and Hong Kongs role as a testing ground for loosened controls on the currency.

Yuan bank accounts were introduced in Hong Kong in 2004, and some shops accept payment in yuan. Chinese financial institutions can also issue yuan bonds in Hong Kong.

The Hong Kong dollars record lows and falling interest rates are a consequence of the territorys currency peg to the U.S. dollar, which requires Hong Kong to track loose U.S. monetary policy.

The dollar has hit record lows against the euro and the Swiss franc and a broad basket of major currencies, dragging the Hong Kong dollar down with it because of the peg. Imports, especially for food from China, have become more expensive as the currency has fallen, adding to inflation.

But analysts say price pressures are not severe enough in Hong Kong to provoke a change in the two-decade old currency peg that would allow the currency to rise. Government officials also say the peg will stand unchanged.

“In theory, Hong Kong could widen the trading band but that would severely undermine the credibility of the Hong Kong Monetary Authority and wouldnt make much sense,” said Kevin Lai, senior economist at the Daiwa Institute of Research. “It would put increased pressure on the Hong Kong dollar.”

The Hong Kong dollar is pegged at 7.8 to the U.S. dollar but can trade at 7.75 to 7.85. The U.S. dollar traded at 7.7930 on Thursday.

“In a historical context, inflation in Hong Kong is not very high,” said Mirza Baig, strategist at Deutsche Bank. “It does not justify a policy shift.”

Nor is there any guarantee that a stronger currency would have the desired effect: the Singapore dollar, for instance, has been rising, but inflation in Singapore has still jumped to a 26-year high.

Equally, Joseph Yam, chief executive of the Hong Kong Monetary Authority, the central bank, said this month that the exchange rate was not to blame for Hong Kong inflation, but rather the rising cost of labor.

A 10 percent decline in the U.S. dollar adds only 0.8 percent to Hong Kong prices in the short term and 1.6 percent in the medium term, Yam said.

Economists say strong economic growth averaging more than 7 percent for the past four years is helping push up labor costs and thereby inflation.

Yet inflation may slow as economic growth is set to ease this year to 4.6 percent as Hong Kong feels the effects of weaker global demand, according to a Reuters poll.

Banks in Hong Kong hope that providing yuan services will improve profits. They even encourage residents to open accounts at China branches that offer higher interest rates. But there are restrictions that limit how much money can be exchanged for yuan.

Chen, who also opened a yuan account at a bank in China, where she often travels on business, would like to put 90 percent of her savings in yuan. Daily limits on withdrawals from yuan accounts in Hong Kong and China, however, mean that most of her savings remain in Hong Kong dollars.

“The peg provides stability,” she said. “But right now we are getting the short end of the stick in terms of the Hong Kong dollars value.”

BEIJING: Officials defended Chinas efforts to stop rampant copying of movies and other goods, saying Thursday that 4,322 people had been convicted of product piracy last year and promising special efforts to protect Olympics-related trademarks.

“The Chinese government has taken concrete steps and its success is there for all to see,” Yin Xintian, a spokesman for the State Intellectual Property Office, said at a news conference.

In an annual report, the agency said the authorities had seized nearly 76 million pirated movies, software discs and other goods last year and shut down 13,170 piracy-oriented businesses.

Yin said courts had convicted 4,322 people of product piracy, though he said he did not know what penalties they had received.

Officials said they were making special efforts to prevent unlicensed use of Olympics-related logos and other property ahead of the Beijing Summer Games in August.

“We are extending comprehensive and strict protection to Olympic intellectual property,” Yin said. “The Chinese government has the resolve and capability to make sure that during the Olympic Games we create a favorable climate for intellectual property.”

China is the source of 80 percent of the fake goods in the world and holds the key to stopping the trade, Jose Barroso, president of the European Commission, said last month. The EUs trade commissioner, Peter Mandelson, said this week that Chinas ambition of turning its companies into global innovators would fail unless it increases protection against trademark theft.

Yin acknowledged that China faced an uphill struggle against piracy.

“China is a country which has only had an intellectual property rights protection system for a short period of time, just 20 years or so, and people dont know as much about the matter as in Western nations,” Yin told a news conference.

“Its natural that there will be some piracy.”

Washington filed a complaint with the World Trade Organization in April 2007, accusing Beijing of violating its trade commitments by failing to stop product piracy.

Despite Chinas strengthening of the legal system and numerous highly publicized anti-piracy campaigns, complete with televised burnings of fake DVDs, pirated goods are still openly available.

Xu Chao, deputy director general of the National Copyright Administration, said it was often not as simple as it seemed to close such stores.

“Many malls let out counters, and each counter is essentially run independently, and if they do something illegal youd have to shut the whole mall. So this is a complicated question,” Xu said.

The State Council on April 9 approved a new intellectual property rights strategy to crack down on infringements, make sure companies follow international practice and raise awareness of intellectual property rights among companies and the nations 1.3 billion people.

It was the first time the cabinet, headed by Prime Minister Wen Jiabao, had been involved in the process, Yin said Thursday.

Xu said the government was still in the midst of a campaign started in 2006 to see that Chinese companies used only licensed software. He said the authorities had no time frame for completing the effort.

“We need time because our regime has not been in place a long time,” Xu said.

“We hope Western countries can grant us more time,” he said. “The international community has to be patient.” EU criticizes Chinese goods

The European Union says China supplied half of all dangerous products seized by the European authorities last year, The Associated Press reported from Brussels on Thursday.

The EUs executive office says consumer confidence in Chinese goods has fallen dramatically after high-profile recalls of toxic toys last year.

It says in a report released Thursday that the EUs rapid alert system flagged 1,605 dangerous products last year - up 53 percent from 1,051 the previous year. The national authorities in the EUs 27 nations use the system to share information on toxic goods and product recalls.