The prospect of an EU intervention in the Greek economy drew a step closer when European finance ministers endorsed a 28-day deadline imposed on its government to show that its budget plan is yielding dividends, The Irish Times reported. With European Central Bank president Jean Claude-Trichet pushing hard for Athens to adopt new budget measures, finance ministers in the wider union backed demands from euro-area ministers for fresh cuts and taxes in four weeks if the current plan is shown to have misfired.

Germany and France have suggested in recent days that rescuing Greece may be necessary to safeguard the euro zone, but both countries may have a more pressing motivation in the move—protecting their own banks, The Wall Street Journal reported. German and French banks carry a combined $119 billion in exposure to Greek borrowers alone and more than $900 billion to Greece and other countries on the euro-zone's vulnerable periphery: Portugal, Ireland and Spain. Together, France and Germany's banking sectors account for roughly half of all European banks' exposure to those countries.

Irish Nationwide has suspended the head of its UK operations as a result of lending practices uncovered by the new management team at the lender, The Irish Times reported. Gary McCollum, who was based in the building society’s Belfast office, oversaw Irish Nationwide’s €4.4 billion UK loan book with Michael Fingleton jnr, the son of the building society’s former chief executive, who worked in the lender’s London office.

Greece should lose voting privileges in the European Union if it gets a bailout from the 27-nation bloc, said the head of the business caucus of German Chancellor Angela Merkel’s Christian Democratic Union, BusinessWeek reported on a Bloomberg story. As one of the EU’s 27 members, Greece would be able to block demands accompanying a rescue if the conditions are “too tough,” Kurt Lauk, the head of the CDU’s Economic Council, said.

Wall Street tactics akin to the ones that fostered subprime mortgages in America have worsened the financial crisis shaking Greece and undermining the euro by enabling European governments to hide their mounting debts, The New York Times reported. As worries over Greece rattle world markets, records and interviews show that with Wall Street’s help, the nation engaged in a decade-long effort to skirt European debt limits. One deal created by Goldman Sachs helped obscure billions in debt from the budget overseers in Brussels.

As Greece resists European demands for wider austerity measures, the contrast with the Baltic states couldn't be starker, The Wall Street Journal reported. Faced with similar market worries about their fiscal positions a year ago, Estonia, Lithuania and Latvia bit the bullet. Now there is light on the horizon: Standard & Poor's has lifted its rating outlook on all three to stable from negative, citing the successes achieved in fiscal consolidation. Greece should take note. All three have retained effective currency pegs rather than take the option of devaluation.

European leaders said they wouldn't let Greece succumb to its credit crisis, in an unprecedented pledge of support that could push the 16 countries that share the euro currency closer to collective responsibility for their budgets and debts, The Wall Street Journal reported. Countries belonging to the euro "will take determined and coordinated action, if needed, to safeguard financial stability in the euro area as a whole," leaders of the European Union declared at a summit in Brussels on Thursday, after discussing Greece's budget crisis.

The frenzy has left euro zone governments surprised and bruised, and wondering whether there is anything they can do to stop this kind of assault from the financial markets. The answer is probably no, but that doesn't mean they won't try, The Wall Street Journal reported. From the point of view of derivatives traders in Europe, the timing hasn't been good. Just as the decision by Goldman Sachs and one or two other investment banks to pay out billions of dollars in compensation reignited a U.S.

The tiny Baltic states have pursued closer integration with Europe with enormous zeal. But the price of monetary union may be giving them pause, The New York Times reported. Economists and ordinary citizens alike are watching the protests rumbling through the streets of Athens and the slow response to Greece’s problems coming out of Brussels. “Countries like Estonia and Latvia were once desperate to get in,” said Alf Vanags, director of the Baltic International Center for Economic Policy Studies in Riga.

Germany officials reported no growth for the fourth quarter of 2009 on Friday. While some fear that the slowdown might signal the beginning of another slump, others just see it as a bump in the road to continued recovery, Spiegel Online reported. A number of experts attributed the unexpected drop to factors such as the end of Germany's cash-for-clunkers program in September and the harsh weather conditions that have gripped Germany for most of the winter. "Just look out your window and you know why," Andreas Rees, the chief German economist at UniCredit, told the Associated Press.