Portugal's main opposition leader, the front-runner for the prime ministerial post, said the next government should be given the chance to negotiate some of the austerity measures needed by the country, The Wall Street Journal reported. "It is important that while we guarantee necessary measures are taken in 2011, it is possible to leave some of them for the future government to negotiate, so it could reflect the strategy the Portuguese will choose in the elections," Pedro Passos Coelho said in a speech at his party's conference.

A year since Greece obtained a 110 billion euro ($158 billion) international bailout, politicians and members of the public, fed up with austerity, are pushing their government to restructure its debt, Reuters reported. The government is still strongly resisting the idea but a deep recession and rising unemployment, coupled with slow visible progress in reforming state finances, are prompting even members of the ruling socialist PASOK party to urge the leadership to reconsider.

British care home operator Southern Cross Healthcare said chairman Ray Miles would be replaced with non-executive director Christopher Fisher to help the company's restructuring drive, Reuters reported. "Given that my own experience has mainly been building businesses and improving their operational performance and that the company now faces a period of intense financial restructuring, it is time to hand over to others with more experience of this," Miles said in a statement on Tuesday.

A new European Central Bank liquidity facility to help Ireland’s struggling banks is not likely “for the moment”, Central Bank governor Patrick Honohan has said. In an interview with Market News International, he also said it was too soon to say when the State could return to international bond markets for funding instead of relying on its €85 billion EU-IMF rescue package, the Irish Times reported.

The U.K.'s largest banks should hold more capital and ring-fence their retail banks from riskier investment banking operations under options laid out Monday by a government-appointed panel that are seen wiping billions of pounds off bank profits in order to protect taxpayers from future bail-outs, The Wall Street Journal reported. The Independent Commission on Banking, which has been tasked with coming up with ways to improve stability and competition in U.K.

Speculation intensified last week that European officials are inching closer to a decision to allow Greece to restructure its US$350bn of government debt, International Financing Review reported. If it does so, Greece will become the first Western European country to restructure debt in 60 years. The longer Greece waits, the more of its obligations will be held by official creditors and the less room for manoeuvre it will have.

EU economics commissioner Olli Rehn brushed off a push from Portugal to rethink European demands on the country’s political leaders to agree a common economic policy before a general election in June, the Irish Times reported. Saying a rapid cross-party agreement was important both for Portugal and for Europe, Mr Rehn said such an accord was crucial if an EU/IMF bailout deal was to be reached by mid-May. Experts from the EU Commission, the European Central Bank (ECB) and the IMF will meet Portuguese civil servants tomorrow to assess the country’s aid requirement.

The European Central Bank raised interest rates on Thursday for the first time in nearly three years to tame rising prices just as the euro zone debt crisis claimed Portugal as its latest victim, The Sydney Morning Herald reported. The increase in the ECB's benchmark refinancing or "refi" rate to 1.25 per cent was the first since July 2008 and the first change either way since it was cut to a record low of 1.0 per cent in May 2009.

Financial regulator Matthew Elderfield says he expects legal challenges to fitness and probity tests from executives and directors who served in Irish banks before the financial collapse and who wish to serve in senior posts after January 2012, the Irish Times reported. Such tests would examine their individual performances before the crisis and could lead to them being removed from office and barred from serving as company directors.

A majority of Icelanders will block an accord with the U.K. and the Netherlands on depositor guarantees, a Capacent Gallup poll published by RUV showed, Bloomberg reported. The poll showed 52 percent of voters will reject the bill in the April 9 referendum, compared to 54.8 percent in a Frettabladid newspaper poll published earlier today. Forty-eight percent of voters will support the pact on April 9, Capacent’s poll showed, compared to 45.2 percent of voters in the Frettabladid poll.