Investors seeking shelter from the sea of negative-yielding assets may provide a further boost to Europe’s direct lending market, Bloomberg News reported. Private debt fund managers say the ultra low interest rate environment is set to drive more money into the business of lending to mid-sized companies. Fundraising for the strategy totaled $10.7 billion from January to June, according to research firm Preqin, and the second half of the year is off to a bumper start with several multi-billion-euro fundraisings already announced.

Italian regional bank Popolare di Sondrio (BPSI.MI) said on Thursday it would sell 1 billion euros’ ($1.1 billion) worth of bad loans to lower their share of total lending to around 8% by 2022, Reuters reported. The bank said it had booked 106 million euros in loan writedowns between January and June, raising its provisions on defaulted loans to 68.4% of their value, meaning the latest sale was not expected to have any further negative impact. Popolare di Sondrio held impaired loans equivalent to 13.65% of total lending at the end of June.

The cost of insuring PizzaExpress’ debt against default has jumped to its highest level amid concerns over the chain’s borrowing as it grapples with an increasingly difficult UK market and a costly overseas expansion, the Financial Times reported. As one of the oldest and largest casual-dining operators in the UK, PizzaExpress has been buffeted by slowing consumer spending and increased costs from a combination of rising business rates and increases to the national living wage.

Leoni has hired an external adviser to monitor its ongoing restructuring, two sources said on Thursday. Magazine WirtschaftsWoche reported that representatives of Leoni’s creditors had met on Monday to discuss the firm’s liquidity situation, Reuters reported. Leoni has hired Hans-Joachim Ziems as an external expert for the restructuring, the sources told Reuters, adding that Leoni managed to reassure its creditors. Leoni said it was in constructive talks with its creditors but declined to provide details, adding that its lenders supported its saving and strategy scheme.

Industrial production in Germany dropped by a larger-than-expected 1.5 per cent month on month in June, compounding fears that Europe’s largest economy could be heading for its first recession in more than six years, the Financial Times reported. Analysts polled by Reuters had estimated output would fall 0.4 per cent during the month compared with May. The fall meant that industrial production was 5.2 per cent lower than a year ago, Germany’s statistics office said. Carsten Brzeski, ING’s chief economist for Germany, characterised the figures as “devastating, with no silver lining”.

An investment group owned by Turkey’s military pension fund is in last-minute talks about a takeover of British Steel, offering hopes of a deal that could save thousands of jobs, the Financial Times reported. Ataer Holding, a wholly owned vehicle of state military retirement scheme Oyak that is also the largest shareholder in Turkish steel group Erdemir, is negotiating with the UK government about acquiring the collapsed steelmaker, according to two people familiar with the matter.

Large European banks lined up on Wednesday to warn that the low interest rate environment would hurt their earnings, wiping hundreds of millions of euros off their market valuations, the Financial Times reported. UniCredit, Italy’s second-largest bank by market capitalisation, cut its revenue forecast for this year to €18.7bn from €19bn due to what chief executive Jean Pierre Mustier described as the “prevailing environment, with rates expected to be lower for much longer”.

A Spanish court has summoned Mikhail Fridman, who controls retailer DIA, to appear before it next month in an investigation into the bankruptcy of digital entertainment firm Zed Worldwide, a judicial source said on Wednesday, Reuters reported. Fridman had been called to the Madrid-based Audiencia Nacional major crimes court on Sept. 12 after a Spanish anti-graft prosecutor alleged that the Russian tycoon had played a role in Zed’s bankruptcy, the judicial source told Reuters. A spokesman for Fridman said he had not received any legal notification regarding the summons.

Pessimism among global businesses has risen sharply in the third quarter of the year as US-China trade tensions, the slowing Eurozone economy, and the rising chances of a no-deal Brexit spook firms, City A.M. reported. The quarterly global risk survey from Oxford Economics, released today, showed that 19 per cent of companies think a deterioration in the global economy is highly likely, compared to seven per cent in the second quarter.

Steinhoff International Holdings NV is considering an initial public offering of Pepkor Europe, its fastest-growing unit, as the scandal-hit South African retailer seeks funds for the next phase of its recovery plan, people familiar with the matter said. The company has been discussing a listing of Pepkor Europe with potential advisers, according to the people, who asked not to be identified because the information is private, Bloomberg News reported. The business -- which owns the Pepco and Dealz chains as well as Poundland in the U.K.