Oesterreichische Volksbanken AG, the Austrian lender that failed a European stress test, is seeking a restructuring as writedowns will result in an annual loss of as much as 750 million euros ($1 billion), Bloomberg Businessweek reported. Volksbanken, majority-owned by a group of 62 regional cooperative banks in Austria, will write down the value of its corporate-client unit Investkredit and its Romanian bank by a combined 700 million euros, the Vienna-based company said in a statement.

Losses for private investors on Greek debt in the second financing package for Athens are likely to be between 30 and 50 percent, rather than the earlier agreed 21 percent, euro zone officials said on Wednesday, Reuters reported. The euro zone is reviewing the terms of its second financing package for Greece, including the private sector contribution, because Greece is in a deeper than expected recession and market interest rates have changed since then.

The European Commission on Wednesday set out proposals to shore up European banks in the face of the region's escalating sovereign-debt crisis, calling for a more-stringent review of the banks that will likely result in a broad recapitalization program, The Wall Street Journal reported. The much-anticipated release, labeled a "comprehensive response" by the commission, contains a number of old ideas that had already been announced and a few new ones.

The day after Parliament in tiny Slovakia voted to reject the expansion of a European rescue fund, causing the government to fall and threatening efforts to end Europe’s debt crisis, politicians there struck a deal that should permit the expansion of a rescue fund for the euro after all, the International Herald Tribune reported. The changes to the fund need to be approved in all 17 of the nations that use Europe’s single currency. Slovakia, a small former-Communist country of 5.5 million, is the only holdout.

As many as 10,000 people could see ownership of their homes transferred to local authorities under a scheme proposed by the Inter-Departmental Working Group on Mortgage Arrears, which published its report this morning, the Irish Times reported. Taoiseach Enda Kenny said the move was one of a number of options which would be considered as part of efforts to cure the debt crisis.

Slovakia’s government became the first in the eurozone to fall over opposition to bailing out indebted economies after the country’s parliament voted down approval for enhancing the bloc’s rescue fund, the Financial Times reported. After hours of debate, the final vote on approving new powers for the €440bn European financial stability facility failed late on Tuesday evening with only 55 of the parliament’s 150 MPs voting in favour, causing the coalition government of Iveta Radicova to collapse. Slovakia is the last of the 17 eurozone countries to approve the improved rescue fund.

Greece is likely to receive an €8 billion aid tranche it needs to stave off bankruptcy in early November, EU, IMF and ECB inspectors said in a joint statement today, the Irish Times reported. The statement came after the troika concluded its week-long review of the country's finances. In the statement, the troika said the Greek recession will be deeper than was anticipated in June and a recovery is now expected only from 2013 onwards.

Sovereign bonds were once considered among the safest of all investments. Yet with Greece teetering and several more euro-zone countries on the watch list, the Continent's banks are in trouble. The European Union is struggling to come up with an antidote, Spiegel Online reported. Three years after the collapse of the Lehman Brothers investment bank in September 2008, the euro crisis is heading toward a new peak.

Norske Skogindustrier ASA, the second-largest newsprint producer, is planning to sell assets and issue debt backed by its accounts receivable to stave off a default that credit markets judge is a 93 percent certainty, Bloomberg Businessweek reported. The Norwegian papermaker is in talks with potential buyers of at least 200 million kroner ($35 million) of assets it considers non-core and plans to raise as much as 125 million euros ($169 million) from the securitized debt transaction, Norske Skog Chief Financial Officer Audun Roeneid said in a telephone interview.

Europe's banks expect to be told to raise more capital under a Franco-German effort to solve the euro zone debt crisis after the state rescue of Franco-Belgian lender Dexia SA, Reuters reported. Dexia agreed to the nationalisation of its Belgian retail bank and secured 90 billion euros (£78.4 billion) in state guarantees, in a rescue that raises pressure on other euro zone countries to strengthen their banks.