Europe

The trustee liquidating Bernard L. Madoff Investment Securities LLC said he needs to hire attorneys in Luxembourg to help recover customer assets in that country, Bloomberg reported. Irving Picard, the lawyer appointed by the Securities Investor Protection Corp. to unwind the now-defunct firm of convicted fraud mastermind Bernard Madoff, is responsible for conducting a broad investigation of Madoff’s assets and actions. Picard has said he’s already recovered about $1 billion to repay Madoff clients. In court papers filed yesterday in U.S.

Polish corporate bankruptcies rose by 25 percent year-on-year in the first quarter of 2009 to 126, a sharp reversal in a positive downward trend observed from 2002, Coface Poland said in a report on Monday. In 2008 the number of bankruptcies declined by 7 percent year-on-year, said the report, quoted by Polish news agency PAP. "In 2009 bankruptcy statistics, firms are appearing whose bankruptcy was directly influenced by crisis-related factors," the report said, identifying a dramatic decline in the number of orders as a primary bankruptcy factor.

Europe’s recession deepened more than estimated in the fourth quarter after companies scaled back production and consumer spending declined. Gross domestic product in the euro region declined 1.6 percent from the previous three months, the most in at least 13 years, the European Union’s statistics office in Luxembourg said today, revising down a March 5 estimate of a 1.5 percent contraction. Investment plunged 4 percent and household spending fell 0.3 percent. From a year earlier, GDP shrank 1.5 percent, the only full-year drop on record.

Caja Madrid may be the first Spanish bank to stop interest payments to mortgage-backed bond investors as loan defaults soar, according to Standard & Poor’s. Homeowners lagged behind on repayments on 72 billion euros of mortgages as of January, Bank of Spain data show, after the credit crisis halted a real-estate boom. “A number of deals” may have to defer interest, said Dipesh Mehta, an asset-backed debt analyst at Barclays Capital in London. “Unemployment is the biggest risk” to Spanish mortgage bonds, he said.

Julius Meinl V, the scion of a Viennese business dynasty whose name has been synonymous since the days of the Hapsburgs with luxuries like exotic coffee, handmade tortes and discreet private banking, has been jailed on suspicion of fraud at a company linked to the family, the International Herald Tribune reported. Prosecutors accused Mr. Meinl of artificially bolstering shares of the real estate company Meinl European Land on the Vienna stock exchange, even as its investments in real estate across Eastern and Central Europe cratered. Mr.

Qimonda, the insolvent German memory-chip maker, yesterday entered formal bankruptcy proceedings as its search for an investor dragged on, the Financial Times reported. The company said 915 of just under 3,400 employees would keep their jobs as it shuttered more sites--including its main plant in Dresden. Michael Jaffé, the insolvency administrator, said he remained in talks with "potential interested parties", and with governments in Germany and Portugal about supporting any new owner.

There are many small tragedies within a global disaster like this, the Business Spectator reported, and one of them is Ventracor--for years one of Australia’s leading biotech prospects. Two weeks ago, Ventracor went into voluntary administration and is now, amazingly, facing complete closure. It has no debt and a technology that works: 400 people are walking around in the United States with its artificial heart whirring in their chests.

Group of 20 leaders need to give regulators oversight of unregulated markets and products, such as credit-default swaps and collateralized debt obligations, to prevent future systemic crises, according to Jean-Pierre Jouyet, head of the French market watchdog AMF and head of an international task force on unregulated markets. "The crisis doesn't arise from the markets but from the lack of organization of some of them," Mr. Jouyet said in an interview Tuesday. "We need to redraw the perimeter of regulation." Financial regulators are looking to the G-20 for guidelines to act, with U.S.

Spain's government plans to set up a bank restructuring fund to inject capital or liquidity into small and medium-sized savings banks facing problems, Spanish media reported on Thursday. The fund would form part of a bank intervention plan Prime Minister Jose Luis Rodriguez Zapatero announced on Wednesday. The publicly run recapitalization fund would buy preferential shares in banks or provide loan guarantees to institutions running short of liquidity, newspaper El Pais reported.

German Chancellor Angela Merkel may be losing valuable time that General Motors Corp.’s Opel business doesn’t have as she holds out against taking a stake in the unit. Merkel says U.S. President Barack Obama’s rejection of GM’s recovery plan gives European leaders a 60-day breathing space to help save Germany-based Opel. Unions and analysts say governments need to take control of the division now or risk it falling victim to a restructuring focused on the U.S. business.