Brussels and Italy have agreed on a rescue of Monte dei Paschi di Siena bank, outlining a draft plan that involves significant cost cuts, some investors taking a hit and executives facing a cap on pay, the Financial Times reported. The announcement brings the long-running saga over the future of Italy’s oldest lender towards a close, with Rome signing off on an investor bail-in and the kind of deep restructuring MPS fiercely resisted for more than a year.

Level, the new budget airline from IAG SA, may start flying across the Atlantic from Rome in the latest bid by a low-cost carrier to capitalize on Alitalia SpA’s insolvency, Bloomberg News reported. Level, which will lift its fleet of two Airbus SE A330 jets to five in 2018, will initially focus its expansion on Italy and France, IAG Chief Executive Officer Willie Walsh told reporters ahead of Level’s inaugural flight on Thursday. Rival Norwegian Air Shuttle ASA this week said it’s adding U.S. routes from Rome as bankruptcy proceedings force Alitalia to scale back.

German shipping group Rickmers said it would file for insolvency after bondholder HSH Nordbank rejected its restructuring plan a day ahead of a last-ditch bondholders' meeting, Reuters reported. Rickmers had proposed a revamp plan under which the equity stake of owner Bertram Rickmers was to be reduced to 24.9 percent, while bondholders, HSH Nordbank and potentially another bank would hold 75.1 percent. But HSH "highly surprisingly" rejected that plan, Rickmers said in a statement on Wednesday.

Italy’s troubled banks may suffer an additional 10 billion euros ($11 billion) in losses from the sale of their bad loans at current market prices, said Ignazio Visco, Bank of Italy governor and ECB governing council member. “If they were sold at the very low prices offered by the few large specialist debt collection agencies active in the market today, which pursue very high returns, the amount of additional writedowns would be in the order of 10 billion euros,” Visco said on Wednesday at the central bank’s annual meeting in Rome, Bloomberg News reported.

U.K. mortgage approvals fell to a seven-month low in a sign the housing market is slowing, though Britons are continuing to take advantage of low interest rates to take on unsecured debt, Bloomberg News reported. Lenders approved 64,645 home loans in April, the fewest since September and below the median forecast in a Bloomberg survey. Mortgage lending grew 2.7 billion pounds ($3.5 billion), the least since April 2016, the figures from the Bank of England show.

One of the European Central Bank’s most senior officials has called for Greece’s creditors to provide more detail on the debt relief they will provide the country if the ECB is to include Athens in its stimulus programme, the Financial Times reported. Benoit Coeure said the ECB needed more clarity on the sustainability of the country’s debt pile – currently at 180 per cent of GDP – before making a decision on whether it could be included in its quantitative easing. Talks between the EU and IMF on the debt relief to be afforded to Greece broke down at a meeting earlier this month.

A Berlin-based law professor has filed a cease-and-desist request aimed at quickly ending Germany’s involvement in bond purchases by the European Central Bank, a surprise legal move that underlines mounting German anger over the ECB’s easy-money policies, The Wall Street Journal reported.

Brussels is pressing for sovereign debt from across the eurozone to be bundled into a new financial instrument and sold to investors as part of a proposal to strengthen the single currency area, the Financial Times reported. A European Commission paper on the future of the euro, seen by the Financial Times, advocates the launching of a market of “sovereign bond-backed securities” — packaging different countries’ national debt into a new asset.

Italian government debt is under-performing its eurozone rivals this morning as investors hone in on the prospect of earlier than expected elections in the bloc’s third largest economy, the Financial Times reported. Italy’s 10-year debt yield, a measure of the government’s borrowing costs, has gained over 2 basis points (0.02 percentage points) this morning to hit 2.2 per cent – a two week high – after former PM Matteo Renzi raised the prospect of an autumn vote. Yields fall when prices rise.

The European Union has agreed on new measures to revive the region’s asset backed securities market while imposing rules on the industry to minimize risk-taking, The Wall Street Journal reported. Late Tuesday night, after 18 months of discussions, lawmakers and EU governments reached a political agreement on a proposal put forward by the EU’s executive arm, the European Commission, that is part of the bloc’s plan to bolster capital markets.