Greek parties will try yet again on Wednesday to strike a reform deal in return for a new international rescue to avoid a chaotic default, after a string of delays which have prompted some EU leaders to warn that the euro zone can live without Athens, Reuters reported. As one deadline after another has come and gone, leaders of the three parties in the coalition of Prime Minister Lucas Papademos postponed what was supposed to have been a crunch meeting on Tuesday until the following day.

France's biggest listed banks are expected to report lower earnings next week as they forge ahead with downsizing plans aimed at addressing concerns over their exposure to the sovereign debt of Europe's troubled economies, Dow Jones reported. BNP Paribas and Societe Generale are likely to have been hit in the fourth quarter by restructuring costs as the two banks strive to reduce the size of their balance sheets and meet Europe's new stringent capital rules. Analysts are expecting further write-downs on the banks' Greek sovereign bonds.

The European Union sought to patch up differences with Britain over financial regulation, saying on Tuesday there was room for exemptions in a draft European banking law to accommodate stricter local supervision of lenders, Reuters reported. Jonathan Faull, head of the European Commission's financial services unit, said it was a matter of crafting exemptions in the draft EU bank law so Britain, Sweden and others can tailor their local supervision.

German chancellor Angela Merkel told Greece today to make up its mind fast on accepting the painful terms for a new EU-IMF bailout, but the country's political leaders responded by delaying their decision for yet another day, the Irish Times reported. Failure to strike a deal to secure the €130 billion rescue - much of which Germany will fund - risks pushing Athens into a chaotic debt default which could threaten its future in the euro zone.

A group of top European banks is disclosing that they didn't borrow money under the European Central Bank's bank-lending program, fearful of being perceived as bailout recipients, The Wall Street Journal reported. The ECB in late December doled out a total of €489 billion ($643 billion) in three-year loans at a 1% interest rate to 523 banks. The primary goal was to avert problems at banks that faced waves of maturing debt but didn't have access to borrow money via traditional funding markets.

European policy makers have begun to worry about similarities between the Portuguese and Greek economies that they fear could derail Portugal's €78 billion ($103 billion) bailout program, The Wall Street Journal reported. That would raise further doubts about the strategy for resolving the euro-zone government debt crisis, which has centered on rapid cuts in budget deficits. If Portugal's program fails, it will add fuel to arguments that the medicine prescribed by Europe undermines growth and thus weakens governments' ability to shoulder large debt burdens.

Romania's prime minister quit on Monday after a series of at-times violent nationwide protests against budget cuts and declining living standards, as deepening political turmoil fueled by Europe's prolonged economic crisis spreads across the Continent, The Wall Street Journal reported. Thousand of Romanians have taken to the wintry streets of Bucharest and other cities in recent weeks to vent their anger at the center-right administration of Emil Boc, who has implemented tough austerity measures in an effort to shore up state finances.

British retailers suffered their second weakest January since records started in 1995 as shoppers reined in spending after splashing out on December discounts, a British Retail Consortium survey showed on Tuesday, Reuters reported. The value of retail sales on a like-for-like basis - a measure favoured by equity analysts - was 0.3 percent lower on the year after a 2.2 percent rise the previous month. Total sales, which include new floor space and are closer to the measure used in Britain's official statistics, grew 2.1 percent, down from a 4.1 percent annual rise.

Greek premier Lucas Papademos held last-minute talks on Sunday with international lenders on wage and pension cuts amid fears that political leaders may reject a second €130bn bail-out and plunge the country into a chaotic default, the Financial Times reported. Evangelos Venizelos, finance minister, said “It’s not an impasse but there are problems for the Greek side” over terms of a medium-term package being negotiated with the so-called “troika” – representatives of the European Commission, European Central Bank and International Monetary Fund.

Greece may breathe a sigh of relief when—or if—it finally completes its long-delayed debt restructuring next week. But the plodding negotiations have been bad news for another country: Portugal, whose creditors fear they may be force-fed the same difficult debt restructuring terms that are on the table for the Greeks, The Wall Street Journal reported.