With its massive austerity measures, Portugal has become the poster child of the troika of the EU, ECB and IMF. But the country is still stuck in a deep recession and it is unclear how it will return to growth. It may need to rely on European loans for years to come, Spiegel Online reported. Portugal's prime minister expects government employees at their desks and working on Entrudo, the traditional high point of the country's Carnival celebrations, which falls on this Tuesday.

Holders of a junior-ranking Dexia bond are escaping the rough treatment meted out to bondholders of low-ranking Irish bank notes after Dexia Bank Belgium announced it would buy back a deeply subordinated issue at 25% of par, Reuters reported. While the tender price set by Dexia Banque Belgium may appear less generous than what other European banks have recently offered for their subordinated debt, it is more generous than what subordinated debt holders of Irish bank paper were offered in 2010/2011.

Top European banks, responding to new regulations and wary of lending, are stashing increasingly large sums of money at central banks around the world in a collective flight to safety. The eight giant European banks that have disclosed their annual results in recent weeks reported holding a total of about $816 billion in cash and deposits at central banks as of Dec. 31, according to calculations by The Wall Street Journal. That is up 50% from a year earlier, when the same banks were holding roughly $543 billion.

Royal Dutch Shell is in talks with bankrupt refiner Petroplus to process crude oil temporarily at its Petit-Couronne facility in France, a union official said on Monday, Reuters reported. The refinery would process crude oil for Shell while a buyer is sought for the installation in northern France, under a draft deal that may be signed this week, said Nicolas Vincent of the CGT union. Shell confirmed that it was in talks on the future of the refinery, which it used to own.

After months of tense negotiations, euro zone finance ministers worked deep into the night Monday to try to agree on a second giant bailout to bring Greece back from the brink of default, subject to strict conditions and in exchange for yet more severe austerity measures, the International Herald Tribune reported. Under the bailout terms, Greece is supposed to reduce its debt to 120 percent of gross domestic product by 2020, from about 160 percent now.

Optimism is growing that Greece has finally done enough to secure a second bailout after it set out extra budget savings, but the moves failed to ease tensions with EU paymaster Germany, Reuters reported. Time is running out for Greece to seal the 130 billion euro (107 billion pound) rescue and avoid bankruptcy, but Greek officials hope euro zone finance ministers will sign the deal off on Monday - a month before Athens needs the money to make 14.5 billion euros of debt repayments due on March 20.

Portugal's unemployment rate jumped to 14% in the final three months of last year, surprising economists and suggesting that austerity measures being implemented under the country's international bailout are creating a bigger-than-expected dent in the economy, The Wall Street Journal reported. A total of 771,000 people were without jobs in the fourth quarter, up from the previous quarter when the jobless rate stood at 12.4%, the country's national statistics bureau said Thursday.

Hellas Telecommunications Luxembourg II SCA filed for Chapter 15 bankruptcy to put on hold certain lawsuits pending against the company in New York State Supreme Court, Bloomberg Businessweek reported. The company, based in London, listed both debt and assets of more than $100 million in documents filed today in U.S. Bankruptcy Court in Manhattan. Chapter 15 protects foreign companies from U.S. lawsuits and creditor claims while a company reorganizes abroad. Hellas Telecommunications Luxembourg is asking the U.S.

Europe’s creditor countries struggled to bridge divisions over aid for debt-plagued Greece, while welcoming commitments from Athens for budget cuts as the clock ticked toward a possible default next month, Bloomberg reported. In a replay of the brinkmanship that marked the early stages of the Greek crisis two years ago, finance ministers extracted concessions from Greece intended to pave the way for the endorsement of a 130 billion-euro ($171 billion) aid package next week.

The European Central Bank is preparing to pass profits on its Greek bond holdings to eurozone governments for use in funding Greece’s second bail-out, senior policymakers have indicated. Comments by ECB’s governing council members suggest a deal is possible, which could help reduce Greece’s public debt mountain – although possibly only over a period of years, the Financial Times reported.