Asia Pacific

The lower house of India's Parliament approved a government proposal to strengthen the central bank's regulatory powers, paving the way for overhauls of the banking sector that could draw investments from more foreign banks as well as local industrial companies, The Wall Street Journal reported. The bill proposes to give the Reserve Bank of India the power to take temporary control of private banks in the event of operational irregularities. It would also increase the limit on the voting rights of any one shareholder in a private bank to 26% from 10%.

Cyprus could default on loan payments due this month unless it can reach an agreement on a bailout with international lenders within days, a government official said on Monday, The Telegraph reported. "If in the coming days the state is unable to secure €250m to €300m [£244m), then the state will proceed to default on payments," finance ministry official Christos Patsalides told a parliamentary committee. Patsalides said the government had no "plan B" if it fails to reach an agreement on a bailout, AFP reported.

China's new leaders sent their strongest signal yet that their top economic priority is to remake the economy so it relies more on domestic demand and less on exports and investment in capital-intensive state-owned companies, even if that reduces short-term growth, The Wall Street Journal reported.

PT Berlian Laju Tanker Tbk creditors, with a combined total of about $125.5 million in claims, filed an involuntary Chapter 11 petition against the Indonesian ship operator, Bloomberg reported. Gramercy Distressed Opportunity Fund II, Gramercy Distressed Opportunity Fund, and Gramercy Emerging Markets Fund, all located in Greenwich, Connecticut, filed today in U.S. Bankruptcy Court in Manhattan, according to court papers.

To boost their deposit levels ahead of an expected year-end regulatory review, Chinese banks have recently accelerated their sales of high-yield investment products to customers, raising new concerns about the financial system and spurring the government to step up its oversight of the products, The Wall Street Journal reported. Since late last month, banks of all sizes have increased their competition to attract deposits from middle-class savers by offering so-called wealth-management products.

A new survey shows that the real unemployment rate in China is double the official level, and layoffs rose sharply among migrant workers in the past year, underlining a challenge for China's new leaders to maintain growth, The Wall Street Journal reported. The survey of 8,000 households shows the urban unemployment rate hit 8.05% in June, up slightly from 8% in August 2011 and nearly twice as high as the official 4.1% rate. The survey was run by Gan Li, an economics professor at South Western University of Finance and Economics in Chengdu.

China's largest maker of auto parts won a politically sensitive auction for A123 Systems Inc, a bankrupt maker of batteries for electric cars that was funded partly with U.S. government money, A123's investment banker said on Saturday, Reuters reported. Timothy Pohl of Lazard Freres said Wanxiang Group Corp's bid of about $260 million topped a joint bid from Johnson Controls Inc of Milwaukee and Japan's NEC Corp for the maker of lithium-ion batteries. Siemens AG of Germany had also qualified to bid, according to two people familiar with the auction, who asked not to be identified.

A bank raises money from its customers to make an off-the-books investment packaged by a private investment company as a loan to a pawn shop, which in turn makes loans to companies that banks aren’t willing to lend to because they’re not comfortable with the credit risk. Welcome to the wheels-within-wheels of China’s shadow banking system, the China Real Time blog reported. But the complexity being unwound by the recent default of a $22.5 million wealth management product sold by Huaxia Bank Co. to its customers doesn’t stop there.

BTA, Kazakhstan's third-largest bank by assets, has won a vote by its shareholders, dominated by the state sovereign wealth fund, to restructure its $11.2 billion of debt, the second such agreement with creditors in as many years, Reuters reported. In its first restructuring in 2010 BTA had cut net debt by two thirds to $4.2 billion in a deal that bought sovereign wealth fund Samruk-Kazyna an 81.5-percent stake.

Auckland-based organic food company Pitango has been placed into receivership along with its Australian parent company, which is understood to owe millions of dollars to its creditors, Stuff.co.nz reported. Pitango, with around 25 staff, makes a range of soups, curries, risottos, sauces and pastas which are sold in supermarkets. Receivers Ferrier Hodgson said in a statement that Pitango's parent company, Gourmet Food Holdings, had been placed into receivership and that included Pitango, Australian tomato sauce firm Rosella, and Australian biscuit firm Waterwheel.