The eurozone is developing a two-speed economy as the growing impact of global trade tension weighs on some countries while others benefit from their stronger domestic demand base, the Financial Times reported. Economic measures published on Thursday showed encouraging signs for France, but pointed to continued gloom for export-led economies such as Germany and Italy. Both countries are severely affected by the rising US-China trade tensions and weakening global demand.

Specialist lender Amigo has warned it will change its business model to head off a regulatory crackdown, sending its shares plunging more than 50 per cent on Thursday, the Financial Times reported. The UK company, which lends to people with poor credit ratings as long as they have someone to step in should they fail to repay, has drawn the scrutiny of the Financial Conduct Authority over concerns that its customers risk becoming trapped as repeat borrowers on interest rates of close to 50 per cent.

Germany’s economic downturn is reigniting fears in Angela Merkel’s government about the future of its two largest lenders, Bloomberg News reported. The push for Deutsche Bank AG and Commerzbank AG to hold merger talks created a massive backlash and eventually failed. Potential buyers are steering clear. Now, the administration is running out of options just when a looming recession fuels fears Germany’s banks might not be prepared to weather another crisis, according to two senior officials with direct knowledge of the government’s stance. The German Finance Ministry declined to comment.

Italian bonds surged to take benchmark yields to a record low as talks progressed to form a new government, reducing the political risk of fresh elections for investors, Bloomberg News reported. Ten-year yields fell below 1% for the first time and their premium over Germany, a key gauge of risk in the nation, touched the lowest level since May last year when the previous coalition was being formed.

When Ayuka Tserenov lost his job as a loan officer at the giant Kremlin-run lender Sberbank three years ago, he found himself staring at nearly Rbs3.5m ($52,760) in debt, the Financial Times reported. He had taken out a Rbs2.5m loan from his employer to buy an apartment in his southern hometown of Elista when he and his wife had their first child. Mr Tserenov’s Rbs40,000 monthly wage was not enough to cover the down payment, so he took out another Rbs250,000 from another bank, then went deeper into debt to cover further living expenses.

A combination of business taxes and higher staff costs hit first-half profits at PizzaExpress, prompting the UK chain to scale back its expansion plans, the Financial Times reported. The group, which helped pioneer casual dining in the UK, pinned the blame on “industry-wide cost pressures” as it reported that earnings before interest, tax, depreciation and amortisation fell almost 8 per cent to £32.4m in the six months to the end of June.

British banks need “a generation” to fix the cultural issues that led to the payment protection insurance mis-selling scandal, according to the UK’s most senior retail banking regulator, as he warned that bad behaviour could return during the next economic downturn, the Financial Times reported. Jonathan Davidson, director of supervision for retail and authorisations at the Financial Conduct Authority, said lenders had made genuine efforts to reform since they were forced to set up a PPI compensation schemes in 2011.

Bankrupt German wind turbine manufacturer Senvion said on Wednesday is that has not been successful in finding a buyer for all of its turbine business, and that layoffs are expected to occur from September, Reuters reported. “We are now close to having a solution for significant core parts of the business,” Chief Executive Yves Rannou said in a statement, adding that the company had the means to keep afloat until the M&A process is concluded. Creditors will be allowed to vote on the investor concepts at a 10 September gathering, Senvion said.

Investors in Europe’s biggest airline aren’t sitting comfortably in their cabins. German carrier Lufthansa —the top European airline by number of passengers—has seen its stock fall more than 40% over the past six months, The Wall Street Journal reported. European airlines are collectively down 30% due to a weakening economy, labor strikes and cutthroat competition in short-haul markets. Lufthansa’s market value including debt now amounts to just 2.6 times earnings before interest, taxes, depreciation and amortization, compared with 3.2 times for all European airlines.

Zambia should show that it is taking measures to fight corruption to unlock donor aid and investments that have been withheld due to graft concerns, the British High Commissioner to the country said on Tuesday, the International New York Times reported on a Reuters story. Britain, Finland, Ireland and Sweden withheld nearly $34 million in aid to Zambia's social welfare and education sectors in September last year because of concern over financial mismanagement.