FIAT DEALERS GARAGES

The fire sent a mushroom cloud of smoke nearly 20,000 feet into the air over Colorado Springs, shadowing Pikes Peak, whose vistas helped inspire the patriotic tune "America the Beautiful." Closer to the blaze, trees were visibly twisting from the heat.

A famous cog railway that transports tourists from around the world up the picturesque mountainside said it would be closed on Tuesday for a third straight day. The highway that leads up to Pikes Peak has been closed since the fire began nipping at its base over the weekend.

The closures on Pikes Peak, billed the world's second-most visited mountain after Japan's Mount Fuji, have drawn attention to the fire's negative impact on the tourism industry just at the start of the peak summer season.

Fire crews called in massive C-130 military planes on Monday, which swooped low through plumes of black and white smoke to dump fire retardant on the flames.

Firefighters on the ground concentrated on the gated upscale subdivision of Cedar Heights, overlooking the Garden of the Gods whose towering red rock formations jut up from the ground, trying to protect residential houses from nearby flames.

Raging about 80 miles south of Denver, the Waldo Canyon fire had initially prompted the evacuation of 11,000 people at the weekend although residents of the town of Manitou Springs were allowed home on Sunday night.

One of those residents was retired nurse Carol Yeager, 76, who left her stucco home on the orders of police late on Saturday, grabbing a handful of personal effects and her four cats.

"The flames were shooting skyward," she said. "It's cleared up a lot, but police told us if the wind shifts, it's touch and go, and they said to be ready to evacuate again."

FIRE NEAR AIR FORCE ACADEMY

The fire was also within six to 10 miles of the Air Force Academy in Colorado Springs as winds fanned the flames in its direction, and fire authorities listed the academy as being threatened by the blaze along with utilities and watershed.

A recreation area belonging to the Academy was ordered evacuated due to its proximity to the fire, and all trails leading west of the school were closed, the base said.

The blaze would still have to traverse rough terrain, burning down through steep canyons and up mountain ridges, before it could reach the Air Force Academy itself, Academy spokesman Meade Warthen said.

"We don't have any reason at this particular point to think we're going to be inundated, but we're standing by," he said. "There are contingency plans in place. If we need to implement them, we will."

The Department of Homeland Security said it was providing the Federal Emergency Management Agency financial assistance to help battle the Waldo Canyon blaze and other fires, noting the threat to 250 homes in the area.

The blaze ignited as firefighting resources were stretched by the monster High Park blaze northwest of Fort Collins, a university city north of Denver along the state's tinder-dry Front Range.

"We're going to be continuing to have to deal with these fires for weeks to come," U.S. Forest Service Chief Tom Tidwell said. "We anticipate it's going to be a long fire season."

The High Park Fire - the second-largest blaze on record in the state and its most destructive - has consumed 83,205 acres in steep canyons since it was sparked by lightning two weeks ago. It is blamed for the death of a 62-year-old grandmother in her mountain cabin and has destroyed 248 homes.

An estimated 4,300 people remain evacuated from their homes as that fire burns through grass, brush and Ponderosa pine.

In southwestern Colorado, the Weber Fire grew to 8,300 acres overnight but firefighters held it about one mile southeast of the small town of Mancos, east of Mesa Verde National Park. Roughly 50 homes were evacuated, officials said.

Meanwhile, in neighboring Utah, a fast-growing 39,000-acre (15,780-ha) wildfire continued to rage largely out of control on Monday after burning an estimated 30 homes and killing 75 sheep between the rural communities of Fountain Green and Indianola.

Governor Gary Herbert, who toured the fire by helicopter on Monday, estimated the property losses so far at $7 million. No injuries have been reported, but Herbert said fire officials did use a helicopter to rescue some shepherds from the fire's path.

More than 500 structures have been threatened by the Wood Hollow fire, forcing up to 1,500 people from homes.

"The big worry now is the weather. Everything that can be done is being done," Herbert told a televised news conference.

(Additional reporting by Ellen Miller in Grand Junction, Deborah Zabarenko in Washington, and Jennifer Dobner in Salt Lake City; Writing and additional reporting by Mary Slosson; Editing by Eric Walsh)

By Joan Gralla

June 25 (Reuters) - New York City Mayor Michael Bloomberg and the City Council on Monday agreed on a $68.5 billion 2013 budget, which spares 20 fire companies fr om the ax an d increases funding for day -care and after-school programs.

"We've again produced an on-time, balanced budget for our city that doesn't raise taxes on New Yorkers, and that preserves the essential services that keep our city strong," the mayor, a political independent, said at a news conference.

Restoring the fire companies will cost $59 million.

Bloomberg did not reveal what was cut so the 20 fire companies could be saved from the chopping block, along with day care and after-school programs.

"There are so many balls in the air all the time," he said. "Some things wind up on the floor. Some things wind up in the budget."

The city has now won back more than 200 percent of the private-sector jobs lost in the recession; the nation has only regained about 40 percent, Bloomberg said. The recession from December 2007 through June 2009 was the worst such downturn in the U.S. economy since the Great Depression.

Funding for day-care and after-school programs was increased by about $150 million to a total of about $417 million. More than 50,000 children from low-income families will get day care - 7,000 more than initially planned. Almost 30,000 slots for after-school programs were restored.

"A budget is a statement of values, a statement of priorities," Council Speaker Christine Quinn said. "Without a doubt, our No. 1 priority is the importance of providing every child with a quality education," she added.

MUSEUMS, LIBRARIES AND TAXI MEDALLIONS

Cultural institutions - such as museums - are a $6 billion sector of the city's economy. Their funding will rise slightly to $50 million. Libraries will get an extra $90 million, enabling them to be open to the public an average of more than five days a week.

The mayor said there would be "de minimus" layoffs in the new budget. He didn't elaborate on how minimal those layoffs might be, noting that this would be up to the city agencies involved.

The jobs of 400 teachers' aides were saved, partly because the union agreed to cut the amount of time they work each day by half an hour, said Quinn, who is expected to seek the Democratic mayoral nomination.

Bloomberg's third and final term as mayor concludes at the end of 2013.

The City Council is expected to vote on the new budget in the next few days.

At Monday's news conference, the mayor said he has increased t he estimate of how much w ill be raised by selling 2,000 taxi medallions to a total of $1.46 billion from $1 billion.

But the sales now will be spread out over three years. Revenue for fiscal 2013 should total $635 million. Another $365 million will be raised from this one-shot deal in 2014 and $460 million in 2015.

Bloomberg said there would be an "enormous" hole in the city's budget if taxi groups, which have sued the city to block the taxi medallion sales, succeed in their court battles.

The city's 2013 fiscal year starts on July 1.

The budget for the city's 2014 fiscal year has a deficit of $2.5 billion, which Bloomberg said "is going to require an awful lot of work" to close.

New York City has endured 11 rounds of budget cuts since 2007 that have saved nearly $6 billion.

To balance the new budget, Bloomberg is draining a reserve fund he created to pay the healthcare costs of retired city workers by taking out $1 billion.

Bloomberg brushed off a question about whether the city's new budget relies too heavily on non-recurring revenues, though he thanked District Attorney Cyrus Vance for winning legal settlements. Most recently, ING Bank NV agreed to pay a total of $619 million to settle claims it violated U.S. sanctions against Cuba, Iran and other countries.

The city got about $150 million from that federal settlement.

Lower interest rates are expected to reduce debt service by about $90 million in the new budget. (Reporting by Joan Gralla; Editing by M.D. Golan and Jan Paschal)

By Sarah White and Douwe Miedema

LONDON, June 25 (Reuters) - Swiss bank Credit Suisse plans to cut up to one-third of senior employees in its European investment banking department, three sources familiar with the matter said, as a weak economy and tighter regulation continue to erode capital raising and advisory activities.

"In the European investment banking business, they are going to get rid of 60 directors and managing directors," one source said on Monday.

The cuts are part of a plan announced last year to sever some 3,500 jobs throughout the bank worldwide, but the focus on core investment banking signals that corporate despair about the economy persists worldwide.

The securities industry lost about 28,100 jobs during the economic crisis of 2008 and 2009. Surging markets over the next 15 months led to the addition of 10,000 jobs but pessimism after that brief spate of hiring has returned.

The new cuts at Credit Suisse, which earlier this month was slammed with a rare public warning from Swiss regulators to bolster capital, will affect bankers who advise on mergers and acquisitions, stock market listings, financing and debt issues.

"It is about a third of the directors and 10-15 percent of the MDs," the first source said, referring to what are typically the two most senior job ranks in the banking world.

The layoffs are expected to begin in July and could continue over several months, the person said.

A second source said the cuts could end up affecting 20-30 percent of senior investment banking staff in Europe.

Credit Suisse, which last year said it hopes to eliminate $2.1 billion in annual costs by the end of 2013, declined to comment.

Other major investment banks have begun cutting jobs after a rough start to the year. About 4,400 securities industry jobs were lost in the first three months of 2012 in the United States alone - the third consecutive quarterly decline, according to U.S. government statistics.

Several global banks have axed at least 50 people in Asia in the past three weeks, and more are on the way.

Credit Suisse had eliminated about 2,000 of its 3,500 targeted jobs as of the end of the first quarter across its three major divisions of private banking, asset management and investment banking. In all, it is shedding about 7 percent of its workforce, and the latest round comes under that target.

Like many rivals hit by rocky markets, earlier cuts have centered in stock and bond trading, two sources said. The latest round will primarily affect advisory and financing jobs in London, "but obviously spread across the zone," one of the people said.

The bank earlier this year said it planned to fire 126 employees in the New York area by Aug. 6. That comes on top of 109 people sacked there earlier this year.

This month, Chief Executive Brady Dougan told a newspaper he was not planning to issue new shares after the Swiss central bank called on the bank to improve its capital base.

The spat - followed by a three-notch cut in its credit rating by Moody's - led to speculation Dougan's future at the bank was in doubt, though the board has since come out to back Dougan, who is American. (Additional reporting and editing by Jed Horowitz in New York; Editing by Dan Lalor and Phil Berlowitz)

The insurance ban makes it almost impossible to ship Iranian oil as most insurance is undertaken by EU-based companies and the move comes as part of a series of measures designed to put pressure on Iran to halt what the United States and others say is a nuclear weapons program.

South Korea depends on the United States for security, but it has no natural resources and has been scrambling for alternative crude supplies to replace those from a country that supplied 9.4 percent of its needs in 2011.

"South Korea's imports of Iranian oil will be suspended, as the EU will suspend crude imports from Iran and also halt its insurance and reinsurance cover on the crude imports from July 1," a joint statement from the economy, finance and foreign affairs ministries said.

"The government will continue to make efforts to minimize impacts on domestic industry and the economy including oil supply, and exports to Iran, although the imports of Iranian oil are suspended," the statement said.

The official confirmation follows a Reuters story on May 21 that had cited sources as saying South Korea would become the first of Iran's major Asian customers to halt oil purchases.

EU governments on Monday approved an embargo on Iranian oil to start on July 1 and warned Iran that more pressure could be put in place if it continued to defy international demands for limits on its nuclear program.

Around 90 percent of the world's tanker fleet is covered by Western-based protection and indemnity (P&I) clubs, which insure against personal injury and environmental clean-up claims.

South Korea is the world's fourth largest buyer of Iranian crude oil.

Japan will provide sovereign guarantees for Iranian shipments, China has asked Iran to deliver the crude while India has said it would allow state refiners to import Iranian oil, with Tehran arranging shipping and insurance, from July 1.

South Korea's imports of Iranian crude oil fell nearly 40 percent in May from a year earlier, according to official data, reflecting Seoul's efforts to reduce purchases in return for a waiver from U.S. sanctions that could have hit its companies.

South Korea imported 29.22 million barrels from Iran during the first five months of the year, or about 192,000 barrels per day, down almost 16 percent from a year ago, data from the state-run Korea National Oil Corp showed on Monday.

To plug the Iranian supply cuts, South Korea has turned to other Middle Eastern producers, including the world's top exporter Saudi Arabia, the United Arab Emirates (UAE), Kuwait and Qatar.

The United States earlier this month extended exemptions from its sanctions on Iran's oil trade to seven more countries including South Korea.

Of South Korea's four refiners, only SK Energy and Hyundai Oilbank import Iranian crude. Sources said both refiners will stop importing from Iran when the EU insurance embargo takes effect from July 1.

The United States and the European Union accuse Iran of trying to build nuclear weapons. Tehran says the program is strictly for civilian purposes.

South Korea has also imposed curbs on exports of goods to Iran to reduce the risks of payment defaults.

Korean exporters usually receive payments via won-denominated deposits of the Iranian central bank that are generated by Iran's oil sales here.

(Editing by David Chance and Ed Davies)