Italy’s Treasury has not ruled out extending repayment deadlines on hundreds of millions of euros in state aid to help troubled lender Banca Monte dei Paschi di Siena as it struggles to raise fresh capital, according to sources, the Irish Times reported. Officials said Monte dei Paschi chairman Alessandro Profumo and chief executive Fabrizio Viola had held meetings in the economy ministry today to seek options for the bank, after it failed European Central Bank stress tests.

Italy and France backed away from a clash with the European Commission over their 2015 budgets on Monday by pledging extra measures to cut their deficits, The Wall Street Journal reported. The move comes after the commission, the European Union’s executive arm, warned Rome and Paris last week that their budget plans would violate its fiscal rules.

Debt-stricken Danish tanker operator Torm said on Monday it had agreed a deal with group of its lenders and Oaktree Capital Management, a large U.S. investor in distressed debt, to restructure the company, Reuters reported. The Danish company is one of the largest product tanker companies in the world, owning 43 tankers, two dry bulk vessels and operating 53 more vessels. Torm's net interest-bearing debt amounts to $1.4 billion. It ordered a series of new vessels in the years before the global economic downturn and was then hit by collapsing freight rates.

Permanent TSB and its advisers plan to canvass more than 30 institutional investors and private equity groups in Europe and the US in the coming weeks to seek an investment of €200 million or more to help plug a shortfall in its capital identified yesterday as part of a pan-European exercise by regulators, the Irish Times reported. Permanent TSB was the only bank in Ireland to fail the European Central Bank’s stress tests. The ECB found a capital shortfall of €854.8 million but PTSB said it has already accounted for more than 80 per cent of this through various actions.

How did they do it? Two years ago, Spanish banks were in crisis, in such bad shape that they put the eurozone at risk and required a lifeline of 41 billion euros, or $52 billion, to stay afloat, the International New York Times DealBook blog reported. Now, the slimmed-down Spanish banking sector, bolstered by significant provisions against bad mortgage loans and fresh capital injections from private investors, can take comfort in the results of stress tests by the European Central Bank.

The Irish government and Russia’s A1 are planning to auction a logistics park once owned by former billionaire Sean Quinn, Kommersant reports. A1, part of billionaire Mikhail Fridman’s Alfa Group, will hold public auction on December 5 for sale of Q-Park located in Kazan. The starting price for property, which exceeds 99.500 sq. m, is RU2.575 billion (€40 million). Tenants include Efes, Bosch and Schneider Electric. Mr Quinn, once Ireland’s richest man, was one of biggest foreign investors in Russian commercial property during the Celtic Tiger years before he went bankrupt in January 2012.

Some of the strongest ripples from the European Central Bank's landmark stress tests could be felt in eastern Europe as multinational lenders short of capital mull the future of their Balkan operations, while others face extra losses, Reuters reported. The 25 banks that failed the health check included four which own subsidiaries in eastern Europe. Some banks that passed were found to have overvalued their assets in the region by a significant margin, something that will force them to hold more capital and makes them likely to eventually face extra losses.

Monarch Airlines has agreed a rescue deal that will result in Switzerland’s Mantegazza dynasty, who started the business with just two aircraft in Luton in 1968, selling up completely, The Telegraph reported. Family patriarch Sergio Mantegazza is understood to have become impatient with the airline’s financial troubles after Monarch asked for a third bailout in July despite already injecting £75m into the business in 2011, just two years after putting £45m into the business.

Italy’s banking system had the highest number of lenders flunking the European Central Bank’s review of eurozone banks, reflecting the country’s unremitting economic malaise, the International New York Times reported. Italy’s two largest banks, Unicredit and Intesa Sanpaolo, passed the tests comfortably. However, the central bank said that nine of the 15 Italian lenders under the review had capital shortfalls at the end of 2013 and four of them still must raise more capital, including Monte dei Paschi di Siena.

European banks are likely to need about €10 billion ($12.6 billion) to address shortages of capital identified in a regulatory review, an amount modest enough to cheer markets, investors and analysts say, The Wall Street Journal reported. On Thursday, European regulators planned to privately disclose to around 150 lenders the results of a “stress test” designed to measure the strength of their balance sheets and their ability to survive a deteriorating economic environment.