Up to £26bn in expected defaults and fraud losses on bounce back loans is a very big number, the Financial Times reported. The National Audit Office’s estimate is a measure of the banks’ success as government functionaries shelling out cash to rescue more than 1m small businesses during the pandemic. It could also be a measure of the banks’ potential failure. After all, £26bn out of £43bn in bounce back loans is a lot to pursue in a year or so when payments start to fall due. That won’t make debt collectors popular. Debt collecting hasn’t made banks popular in the past.

Illimity is evaluating potential bids on 2 billion euros ($2.4 billion) of impaired bank loans, a senior executive at the Italian bank said, as disposals resume after the hiatus caused by the coronavirus crisis, Reuters reported. Italy’s 340 billion euro market for problem loans is Europe’s biggest. After more than halving soured debts on their balance sheets in recent years to tackle the legacy of the previous slump, Italian banks are now bracing for an expected wave of defaults caused by COVID-19. Market activity froze at the height of the healthcare emergency.

EasyJet’s losses soared to more than £800m this year, sending the low-cost airline into the red for the first time in its 25-year history, as the coronavirus pandemic continues to threaten the future of companies across the global travel industry, the Financial Times reported. In a sign of increasing desperation for airlines, easyJet chief executive Johan Lundgren urged the British government to prop up the sector further as the company slashes winter flight schedules because of plunging passenger demand.

Germany has presented plans to strengthen financial regulator BaFin’s powers and tighten accounting rules, one day before the start of a parliamentary probe into one of the country’s biggest corporate failures, Bloomberg News reported. The collapse of Wirecard AG this year exposed significant cracks in Germany’s financial oversight, as authorities failed to catch accounting issues at the digital-payments company despite ample warning. Slow decision-making and fragmented responsibilities appeared to allow the problems to go undetected.

As 2020 dawned, bankers throughout Europe were still digging out of the last crisis, with weak lenders in Greece and Italy peddling soured loans and policy makers channeling public funds to frail institutions, Bloomberg News reported. Now, as Covid-19 wreaks havoc, a gathering tsunami of distressed credit risks wrecking a decade of efforts aimed at bolstering the fragile financial industry. The fallout could also undermine the extraordinary efforts by governments and central banks to prevent an economic meltdown.

Measures taken by Transocean Ltd. to stave off a bankruptcy filing could be exactly what ends up sending the offshore drilling company into Chapter 11 alongside some of its biggest peers, Bloomberg News reported. The world’s largest owner of deep-water oil rigs recently engineered a bond swap to trim some of its $9 billion debt load and ease the crunch caused by slumping energy prices. But other creditors, led by Whitebox Advisors LLC and Pacific Investment Management Co., say the transaction amounts to a default because it pledges assets that Transocean already promised to them.

The UK’s economic recovery faltered in September due to the Eat Out to Help Out scheme ending and the renewal of lockdown restrictions, Business Sale Report reported. Business profits remained unchanged from a month earlier, down 21 per cent, while businesses on average reported that profits were down 42 per cent on what they would normally expect for the month of September. According to the Opinium-Cebr Business Distress Tracker, 35 per cent of businesses said that trading conditions were good at the end of September, down from 39 per cent a month earlier.

Finablr said on Tuesday technology and software solutions firm Prism Advance Solutions has made a takeover offer for the UK-listed payments group that includes restructuring and settlement of its debts, but gave no further details on the bid size, Reuters reported. The proposed deal would provide working capital for Finablr and its subsidiaries and Prism will restructure the company’s board. Finablr said it would negotiate a share purchase agreement with Prism.

Britain’s hospitality trade is likely to see more than half a million job losses after the government’s furlough scheme ends this month, as local lockdowns and reduced opening hours hurt the sector, an industry representative said on Tuesday, Reuters reported. Kate Nicholls, chief executive of UK Hospitality, told Britain’s parliament that recent restrictions meant she needed to revise up a forecast of 560,000 permanent job losses -- out of 900,000 currently furloughed workers -- that the body made last month after surveying its members.

Premier Oil Plc will be swallowed by Chrysaor Holdings Ltd. in a reverse takeover, marking the end of the road for one of the oldest independent oil explorers, Bloomberg News reported. The deal, which was first reported by Bloomberg, comes after Premier labored for years under a mountain of debt. The company has finally bowed to pressure from creditors, with Chief Executive Officer Tony Durrant abandoning his plan to acquire some of BP Plc’s North Sea assets and agreeing to step down.