Icelandic retailer Baugur, which holds stakes in House of Fraser, French Connection and Debenhams, said today that it has applied for bankruptcy protection, RTÉ reported. The decision came after the Icelandic retailer said last week it would close its Reykjavik office and cut staff in Britain. In December, the heads of Baugur were also charged with tax evasion amounting to €1.9 million from 1998 to 2003.

The number of registered unemployed people in Spain swelled by nearly 200,000 in January, the fastest monthly increase in more than a decade, as companies struggling with declining sales and liquidity problems laid off workers or declared bankruptcy, the International Herald Tribune reported. The Labor Ministry said Tuesday that the number of people out of work rose to 3.33 million, a 6.4 percent increase over December and a jump of 47 percent since January 2008.

Famed German model railway maker Maerklin filed for bankruptcy protection from creditors on Wednesday after it failed to secure new credit from banks, the International Herald Tribune reported. Maerklin Holding GmbH made the bankruptcy filing at a court in Goeppingen, the company's southwestern German home town. The company said that its everyday business would continue unaffected. Maerklin began 150 years ago as a small factory making tin toys and has evolved into an iconic name in the model railway market.

German Chancellor Angela Merkel and Foreign Minister Frank-Walter Steinmeier, her challenger in Sept. 27 elections, failed to resolve a coalition dispute over nationalization of Hypo Real Estate Holding AG, Bloomberg reported. Talks at the chancellery in Berlin Wednesday broke up with Merkel’s Christian Democratic Union and Steinmeier’s Social Democratic Party unable to bridge a divide over how to save Hypo Real, the Munich-based property lender that’s already received €92 billion ($120 billion) in public funds. Merkel’s dilemma over nationalization of banks is echoed internationally. U.K.

Banco Santander SA’s €1.38 billion ($1.8 billion) offer to compensate clients hit by Bernard Madoff’s alleged fraud may leave them with preferred shares they can’t trade and that the bank might not buy back, Bloomberg reported. That’s a risk Santander clients will have to weigh along with the strings attached to the offer of stock paying a 2 percent annual yield. They include foregoing any legal action and keeping Spain’s biggest lender as their “preferred” bank as long as the shares stay in circulation, which may be indefinitely, according to a proposal seen by Bloomberg News.

Hundreds of British workers walked off the job today, part of a rising tide of industrial unrest sweeping Europe as the continent's economic downturn worsens, the Los Angeles Times reported. Employees at two nuclear power plants in northern England staged wildcat strikes in support of workers at an oil refinery who have been out in protest since the end of last week.

Some Spanish television companies are facing bankruptcy and the government should not slash advertising prices for state-owned channels, Spanish media group Telecinco's chief executive said in an interview published on El Mundo's website on Monday. "The television sector....is facing bankruptcy and all the alarm bells are ringing," Paolo Vasile was cited as saying. Telecinco has been hit by Spain's sharp economic slowdown, which has meant advertisers are cutting budgets.

A spokeswoman for Clifford Chance confirmed a Law.com report that the firm had lost about 20 percent of the lawyers from its Moscow office through layoffs and natural attrition, Bankruptcy Law360 reported. “It's a continuing situation that has been under review for several months now,” spokeswoman Anne Groves said. The news broke just a couple of weeks after the firm announced a redundancy program that could lead to job losses for up to 80 additional attorneys in London.

China has pledged to take all necessary measures to stimulate its economy and fuel consumer spending, but has rejected as “ridiculous” suggestions that its huge pool of domestic savings has been partly to blame for the global financial crisis, the Financial Times reported. In a rare interview, Wen Jiabao, China’s premier, said in London on Sunday that Beijing was considering fresh measures to boost its economy beyond its Rmb4,000 billion ($585 billion, €458 billion, £404 billion) fiscal package launched late last year.

The European Central Bank is drawing up guidelines for European governments that are considering "bad banks" to house lenders' toxic assets, while Germany is moving closer to agreeing to legislation that would help its banks set up individual bad banks, The Wall Street Journal reported. The parties in German Chancellor Angela Merkel's coalition have expressed support in recent days for a plan under which Germany's banks would move bad assets off their books.