Europe

Euro zone finance ministers discussed on Monday ways to make sovereign debt restructuring easier and more predictable as they seek to put together a package of reforms for December to integrate the single currency area more closely. The ministers broadly supported the introduction of “single-limb” Collective Action Clauses (CACs) in euro zone bonds, which would allow for a single restructuring decision to encompass all bonds, Reuters reported. Existing CACs require separate restructuring for separate types of bonds issued by the government.

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Operating losses at Irish explorer Botswana Diamonds increased by almost 45 per cent last year as the company lamented a lack of investment and a sector that is “out of favour”. The company, which has been heavily involved in diamond exploration in southern Africa since the 1980s, said losses for the year ended June 30th, 2018, grew to €556,407 from €310,898 the year before, The Irish Times reported. The company’s annual results show the increased losses can largely be attributed to a charge of €179,524 for the “impairment of exploration and evaluation assets”.

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Euro-zone finance ministers remain worried about Italy’s budget row with the European Commission and are waiting for the next move from the EU executive this week before formally stepping up their pressure on Rome, top officials said on Monday. The ministers are in Brussels for an extraordinary meeting on euro-zone reform and Italy’s fiscal plans are not on the agenda, but Dutch finance minister Wopke Hoekstra expressed the concerns as he entered the Eurogroup talks, The Irish Times reported. “We are all worried about the existing situation.

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The High Court has approved payments of more than €20 million out of the Insurance Compensation Fund to meet a 35 per cent shortfall in awards concerning motorists insured by the collapsed Malta-based insurer Setanta Insurance, The Irish Times reported. The payment orders were sought by the State Claims Agency and were granted on Monday by the President of the High Court, Mr Justice Peter Kelly. They relate to 1,268 eligible claims and will involve total payments of €20,647,966, representing an additional 35 per cent of money due.

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Brexit is already weakening the UK’s grip on Europe’s capital markets, denting London’s status as a hub for millions of deals each day. Key parts of the trading infrastructure for equities, sovereign debt and repo markets are setting up in the Netherlands and Italy, the Financial Times reported. Banks are moving jobs to Paris and Frankfurt. This is “an invisible revolution in the European capital markets”, says Merel van Vroonhoven, chief executive of the AFM, the Dutch regulator.

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The head of the European Central Bank indicated a first interest rate increase could be postponed if unexpected trouble strikes the 19 countries that use the euro as their currency, the International New York Times reported on an Associated Press story. Mario Draghi warned in a speech Friday the current economic expansion remains "resilient" as unemployment continues to fall and consumers remain willing to spend. But he cautioned that slowing world trade is proving to be a drag on the eurozone economy.

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London will no longer be the first stop for European governments selling bonds, as the bulk of business on a key platform switches to Milan ahead of the deadline for the UK’s departure from the EU next year, the Financial Times reported. From the start of March only the UK government and UK-based banks will use a London-based arm of MTS Cash, a venue owned by the London Stock Exchange Group. It plays a key role in linking sovereign borrowers with the investment banks that help price the bonds and sell them to asset managers.

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England’s higher education regulator has admitted it provided a “short-term liquidity loan” to a university in the summer to keep it operating, despite a promise that it would never bail out an institution, the Financial Times reported. The Office for Students, which was formed only this year, did not name the institution or confirm reports on the BBC that the loan was worth £1m. However, the regulator insisted that the university had not been at risk of bankruptcy.

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A company set up by lenders to Johnston Press has acquired the publisher, saying debt cancellation and a cash injection would allow titles including The Scotsman, The Yorkshire Post and The i to continue operations as normal, the Financial Times reported. The “pre-pack administration” deal was completed following the court appointment of administrators to Johnston Press, the newly founded owner JPIMedia said in a statement. The acquisition was denounced by activist Christen Ager-Hanssen, CEO of Custos Group, Johnston Press’s largest shareholder.

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