The three major banks in the State rebuffed the Government’s efforts to get them to lower interest rates during a “tense” and “frosty” meeting yesterday with the Taoiseach Enda Kenny and the Coalition’s most senior Ministers, the Irish Times reported. Senior executives from Bank of Ireland, AIB and Ulster Bank faced down pressure from the Government to pass on the recent reduction in the European Central Bank’s interest rates to variable rate mortgage customers.

Debt-choked Italian directory group Seat Pagine Gialle said it was confident that a debt restructuring accord could be reached that would allow it to continue operating, as it reported a 17.7 percent fall in nine-month core earnings, Reuters reported. Seat, which is in the process of restructuring its 2.7 billion euro debt, said nine-month revenues fell 10.5 percent to 695.6 million euros from a restated 2010 figure. Operating free-cash flow stood at 290.7 million euros it said and earnings before interest, tax, depreciation and amortisation (EBITDA) totalled 273 million euros.

An EU Commission proposal for a common European tax on financial transactions ran into fresh trouble as divisions over the plan resurfaced between European finance ministers, the Irish Times reported. At a two-day meeting in Brussels, which was overshadowed by the escalating political crisis in Italy, questions were also raised about the drive to recapitalise the weakened euro zone banks. The greatest divisions were seen when ministers held their first formal discussion on the commission’s plan to tax financial transactions. “There were very diverse views on this.

A strike by Portuguese public transport workers shut down national train services and the Lisbon subway Tuesday in the latest major protest against austerity measures designed to reduce the country's crippling debt burden, the Associated Press reported. Staff at the state-owned rail company Comboios de Portugal and the Lisbon subway walked off the job during the morning rush-hour. Bus and ferry workers were also due to stop work later in the day.

Car maker Saab will still for now enjoy legal protection from creditors, the court-appointed lawyer overseeing a reconstruction process for the company said on Tuesday after General Motors rejected a Chinese bid for the company, Reuters reported. GM had said on Monday it would stop supplying components and technology to Saab if two Chinese companies succeeded with their acquisition bid -- a hardening in its opposition to the proposed sale of Saab which called into question the survival of the niche brand, which has been under court protection from creditors since September.

A euro zone may survive, but it will not be the present 17-member-state euro zone. What will emerge, if it is to survive, will be smaller and more focused around German financial and monetary disciplines, The Sydney Morning Herald reported. There should no longer be dramatic European Union summits with Nicolas Sarkozy, accompanied by a reluctant Angela Merkel, creating an impression of progress soon to be followed by the grim realisation that little has changed. For instance, the announced 50 per cent haircut in Greek government bonds has not yet been voluntarily accepted.

Italian Prime Minister Silvio Berlusconi pledged to step down after Parliament approves austerity measures, as the euro-zone's third-largest economy tried to stave off the nightmare scenario of a bailout that would test the currency union, The Wall Street Journal reported. The promise to resign, which came after Mr.

Greece can get a crucial €8 billion ($11 billion) slice of bailout money this month if the leaders of the two main parties both commit in writing to the terms of the country's two massive bailouts and the austerity measures and economic reforms that they require, eurozone finance chiefs said Monday, the Associated Press reported. That payment, which has been delayed by two months, would head off a potentially disastrous default as early as December.

Prime Minister Silvio Berlusconi defied huge pressure to resign on Monday, desperately playing his last cards to save his crumbling government as fears over Italy's instability hit markets across Europe, Reuters reported. Berlusconi denied reports by journalists close to him that he would resign within hours, immediately reversing a brief recovery in stock and government bond markets battered by political uncertainty in the euro zone's third economy.

European banks are sitting on heaps of exotic mortgage products and other risky assets that predate the financial crisis, adding to pressure on lenders that also are holding large quantities of euro-zone government debt, The Wall Street Journal reported. Four years after instruments like "collateralized debt obligations" and "leveraged loans" became dirty words because of the massive losses they inflicted on holders, European banks still own tens of billions of euros of such assets. They also have sizable portfolios of U.S.