French President François Hollande said Tuesday the country's budget deficit will be well above what he pledged when he came to power 10 months ago, and Europe needs to change its dose of austerity to fuel an economic recovery, The Wall Street Journal reported. The 58-year-old socialist president came to power in May last year saying he would steer France on a path to growth while also bringing the budget deficit down to 3% of annual output in 2013 from 5.2% in 2011, as the previous government had promised to investors and European peers.

Insolvent German street light maker Hess is holding talks with potential investors with a view to finding a buyer for the scandal-hit company soon, Reuters reported. Hess said on Tuesday it had received expressions of interest from several strategic and financial investors, whom it did not name, and that it had held talks with several of them. The firm, whose search for a buyer is being led by consultancy Ebner Stolz, said it aimed to be sold as a whole if possible. Hess's insolvency filing in February came just months after its stock market debut.

Minister for Finance Michael Noonan has directed Bank of Ireland, AIB and Permanent TSB to reduce their staff remuneration costs by 6 to 8 per cent to aid their return to profitability, the Irish Times reported. The reductions are to be introduced by cuts in payroll and pension benefits, and new working arrangements and structures to deliver efficiency gains. The banks will be expected to begin delivering the cost reductions in 2014. This direction comes on foot of a report on bankers pay for the Government by consultants Mercer.

Spanish fishing company Pescanova said on Tuesday it had found discrepancies between its accounts and its bank debt, Reuters reported. Pescanova's statement comes a day after the stock market regulator opened an investigation into the company for possible market abuse. Galicia-based Pescanova, which catches, processes and packages fish on factory ships, said in a statement to the stock exchange that its auditor, BDO Auditores, was looking into the issue.

British banks have been suffering amid dismal earnings, scandals and regulatory investigations, but three of the country’s largest financial firms handed out seven-figure pay packages to hundreds of employees last year, The New York Times DealBook blog reported. The disclosures this week add to the growing debate over compensation, as regulators look to rein in bankers’ pay.

More Dutch companies declared bankruptcy in February than at any time since records began in 1981, the Associated Press reported. The country's Central Bureau for Statistics also says Monday that on a three-month average, bankruptcies are at their highest level on record: around 680 per month, not counting one-person businesses. The Dutch economy is struggling as the government cuts spending and increases taxes to meet European budget rules that require countries to get their budget deficits down to 3 percent of their annual gross domestic product.

Greater social justice, higher taxes for the wealthy, and a statutory minimum wage will be at the heart of a left-leaning election campaign by Germany’s Social Democrats bidding to unseat Angela Merkel, the German chancellor, in September’s general election, the Financial Times reported. The programme, including stricter regulation of banks and other financial institutions, and statutory quotas for the appointment of women as company directors, was unanimously approved by the Social Democratic party executive meeting in Berlin on Monday.

Britain will resist calls to impose far stricter rules on how much banks can leverage their capital for investments and lending, insisting that there is no need to do so before 2018, Reuters reported. The government is forcing banks to limit leverage to 33 times their capital, in line with international regulations, and rejected a call on Monday from a panel of parliamentarians to stiffen the rules to curb risk-taking even more.

Britain should force all banks to split routine retail operations from riskier investment activities if a single lender abuses new rules designed to protect taxpayers, an influential panel of lawmakers said, Reuters reported. The Parliamentary Commission on Banking Standards, which has been asked to find ways to reform banks, also said on Monday that Britain's financial regulator should be given the responsibility to decide how far banks can leverage their capital for investment and lending. The government's Banking Reform Bill is due to be debated in parliament on Monday.

President Nicos Anastasiades of Cyprus will ask Athens to hand over €2bn from its own bank recapitalisation package to rescue Cypriot banks with operations in Greece, say officials in Nicosia, the Financial Times reported. The unusual request comes as Cypriot officials desperately try to avert a so-called haircut of bank deposits held on the island as part of a proposed €17bn bailout being negotiated with the EU and International Monetary Fund.