Reserve Bank of India Governor Raghuram Rajan said banks should have more power to recoup money from defaulters to rebalance a system that’s skewed in favor of large companies, Bloomberg News reported. The Indian credit system is unhealthy and rests on an uneven sharing of risks and profits that overprotects big borrowers and forces state-controlled banks to absorb losses in downturns without profiting in good times, Rajan said yesterday.

South America’s most economically troubled country, facing fears of a debt default amid tumbling oil prices and a cash crunch, has been thrown a lifeline by its largest lender, China, The Wall Street Journal reported. The Asian giant loosened repayment terms on the nearly $50 billion in loans it has granted Venezuela since 2007, according to Venezuela’s Official Gazette. And President Nicolás Maduro said in a speech last week that his finance minister, Rodolfo Marco, would soon travel to China to try to secure new loans. Mr.

Australian food franchise Pie Face has collapsed into voluntary administration. In a statement released to SmartCompany, the Pie Face Group confirmed Jirsch Sutherland has been appointed as administrators. However, Pie Face said it is “business as usual” as the administrators conduct a review of the chain’s operations. “The move comes as part of a wider company review, which will see the company focus on supporting the growth of its franchise-operated stores as well as the wholesale business,” Pie Face said. “The international businesses are not affected”.

Chains of guarantees, in which companies back loans to other firms, are causing pain for the wider Chinese economy, The Wall Street Journal reported. The central bank cut benchmark lending and deposit rates on Friday to reduce financing costs for companies and help revive growth. Guarantees played a large role in fueling China’s rapid debt expansion over the last six years.

In a related story, China’s central bank said its surprise move to cut interest rates for the first time since 2012 is designed to help small firms and protect depositors instead of all-out monetary easing. How the nation’s lenders respond will determine if it works out that way, Bloomberg News reported. The bulk of bank debt in China is still concentrated on big borrowers, with outstanding credit to small firms less than a third of total loans. The People’s Bank of China’s rate cuts came after months of targeted measures failed to lower financing costs for smaller companies.

South America’s most economically troubled country, facing fears of a debt default amid tumbling oil prices and a cash crunch, has been thrown a lifeline by its largest lender, China, The Wall Street Journal reported. The Asian giant loosened repayment terms on the nearly $50 billion in loans it has granted Venezuela since 2007, according to Venezuela’s Official Gazette. And President Nicolás Maduro said in a speech last week that his finance minister, Rodolfo Marco, would soon travel to China to try to secure new loans. Mr.

China’s central bank is considering changing the way it calculates banks’ loan-to-deposit ratios, a government official briefed on the matter said, signaling efforts to boost credit as the economy falters. Savings that banks hold for non-deposit-taking financial institutions may be classified as deposits, the person said, declining to be identified as he’s not authorized to speak publicly about the matter. Money that banks lent to such institutions would be classified as loans, according to the official. The changes may take effect Jan. 1.

How can a midsize bank torpedo an entire economy? It was the first question asked by the new president of Cyprus, Nicos Anastasiades, on March 1, 2013, when he assumed power and was immediately confronted with the implosion of Cyprus Popular Bank and the rescue package that followed just two weeks later, the International New York Times DealBook blog reported. To that end, Mr. Anastasiades has since commissioned a 40-page study that examines in detail how the collapse of the second-largest bank in the country could have such a devastating effect on the Cyprus economy.

Kazakhstan's Alliance Bank has completed a $1.2 billion debt restructuring and the country's sovereign wealth fund will put 220 billion tenge ($1.2 billion) of special deposits into the bank to support the deal, Alliance's chief executive said on Wednesday. Alliance Bank next plans to merge with two other Kazakh banks, Temirbank and ForteBank, controlled by Kazakh billionaire Bolat Utemuratov, also a minority stake holder in Alliance, a process which will lead to a number of job losses.

One Hong Kong-based hedge fund has accumulated the prospectuses of no fewer than 250 of the trust companies that sit at the heart of the Chinese shadow banking system. These contain virtually no disclosure except on the value of the real estate that backs loans whether committed or proposed. In some ways, China today resembles Japan in the early to mid-nineties or the US in 2007 to 2008 on the eve of their respective financial crises, both triggered by overvalued property.