The Greek government's new austerity measures drew a positive response from European credit and currency markets, further allaying fears that Greece might default on its debt obligations, The Wall Street Journal reported. The measures, which will save the Greek state €4.8 billion ($6.5 billion) a year, include steep cuts in civil-service salaries and entitlements, as well as a rise in Greece's sales tax by two percentage points.

La Seda de Barcelona SA late Tuesday said more than 75% of its creditors had agreed to a lockup agreement that allows the loss-making chemical firm to use an increasingly popular U.K. insolvency tool to refinance its debt, Dow Jones reported. The Barcelona-based company is trying to get its lenders to agree to the restructuring of €600 million of its debt by converting €150 million into equity, extending the maturity of €250 million by eight years, and the remaining €200 million by five years. The syndicated loan was signed in London in June 2006, allowing the company to employ the U.K.

On March 6th Icelanders go to the polls to vote in an historic referendum, The Economist reported in a commentary introducing a reader debate. They must decide whether to accept or reject a deal made by their government to repay to the British and Dutch authorities €3.9 billion ($5.3 billion) lost by British and Dutch savers in Landsbanki, a failed Icelandic bank. Arguments on both sides have been fierce.

The Greek government on Wednesday approved additional tax increases and a 30 percent cut in holiday bonuses for public employees as part of a new raft of austerity measures aimed at narrowing its gaping budget deficit, a government official said, The New York Times reported. The measures aim to generate at least €4 billion, or $5.5 billion, in revenue and savings this year, according to the official, who was briefed on the Cabinet discussions but not authorized to speak publicly ahead of an official announcement.

Fears of a Greek debt default are subsiding -– at least for now -– as the crisis-racked nation prepares to outline hefty new austerity measures aimed at closing its yawning fiscal deficit. But such plans may not be enough to turn around the struggling euro’s fortunes, The Wall Street Journal Market Beat blog reported.

Close to 4 per cent of private residential mortgage accounts had been in arrears for more than 90 days at the end of 2009, according to new figures published by the Financial Regulator, The Irish Times reported. The latest data also shows that house repossessions rose by 20 per cent from the third to the fourth quarter of last year. Mortgage accounts in arrears for more than 90 days rose by 8.9 per cent from the end of September last while the percentage of accounts in arrears for more than 180 days increased by 8 per cent.

The commissioner for monetary affairs at the European Union, Olli Rehn, said on Monday that austerity measures announced by the Greek government to stave off a mounting fiscal crisis were “in the right direction” but not adequate to reduce a bloated budget deficit by 4 percent this year and tackle a debt crisis threatening the euro zone, The New York Times reported. After talks with government and central bank officials in Athens, Mr.

GAZ Group, the Russian carmaker owned by billionaire Oleg Deripaska, “officially completed” restructuring 39.2 billion rubles ($1.3 billion) of debt, clearing the way for the government to guarantee its loans, BusinessWeek reported on a Bloomberg story. “This is a unique transaction because of the large number of participants involved, the large amount of ruble debt and the use of Russian legislation,” Alexander Bazarov, a vice president of OAO Sberbank, which managed the restructuring, told reporters in Moscow today.

Courts in Canada and the United States have rebuffed a British pension regulator's attempt to drag Nortel Networks Corp. into a separate legal battle in the United Kingdom over a multibillion-dollar claim, a Nortel lawyer said, allowing the company to focus on the liquidation of its global assets, The Globe and Mail reported. The British Pensions Regulator had been trying to argue a $3.4-billion claim on behalf of Nortel's 40,000-plus pensioners in the U.K., where Nortel's collapse triggered a pension crisis.

A plan led by Germany and France to bail out Greece with as much as €30 billion ($41 billion) in aid began to take shape amid intense and risky jockeying between Athens and Berlin over timing and terms, The Wall Street Journal reported. Greek officials said they expected to seal a deal by Friday, when Greek Prime Minister George Papandreou meets in Berlin with German Chancellor Angela Merkel, but senior German officials insisted a bailout wasn't imminent.