Government-finance specialist Dexia SA agreed on a restructuring deal with European regulators Friday, ending months of indecision over its future, The Wall Street Journal reported. The lender, which was handed a €6.4 billion ($8.7 billion) lifeline when it became engulfed in debt during the credit crisis, promised to sell off about 35% of its balance sheet to offset the competitive advantages it gained from state subsidies and guarantees. Before the credit crisis, Dexia was a major lender to local governments.

European leaders are quietly considering whether to come to the aid of their troubled neighbor Greece amid fears that the nation might default on its debts and unleash another round of financial crisis, The New York Times reported. Only a month after Dubai was rescued by its neighboring emirate Abu Dhabi, Germany, France and other European powers are discussing whether Greece might need a bailout too. After a decade of debt-fueled profligacy, Greece is confronting what amounts to a run on the bank.

Auto makers are bracing for a brutal 2010 in Europe, as economic troubles and the end of government scrappage programs threaten to drag down sales, The Wall Street Journal reported. High unemployment and the inability of many consumers to access credit are keeping customers out of showrooms. At the same time, sales are likely to be further depressed in the absence of government incentive programs that last year encouraged consumers to trade in old vehicles for new ones.

Never before has Europe’s monetary union seemed so fragile, The New York Times reported in an analysis. Day by day, fears are growing that Greece or another weak country may default on its sovereign debt obligations, forcing the richer countries in Europe to ride to the rescue or risk having one or more of its most vulnerable members leave the 16-nation euro zone. Many European economists discount such a fracture as a remote possibility. But that doesn’t mean Europe has safely emerged from crisis.

Gordon Brown received a twin blow today when a leading ratings agency warned Britain to get a tighter grip on its record budget deficit and figures revealed that the slump of the past 18 months was now officially the deepest since the second world war, The Guardian reported. Fitch said that the UK – along with France and Spain – needed to "articulate more credible and stronger fiscal consolidation during the course of 2010 to underpin confidence in the sustainability of public finances".

French President Nicolas Sarkozy is considering a tax on 2009 banker bonuses exceeding €27,000 ($39,800), following the U.K. government’s introduction of a similar levy, said two French government officials, Bloomberg reported. French banks would pay the charge, though the rate hasn’t been set, said the officials, who declined to be identified because they’re not authorized to speak to the press. Chancellor of the Exchequer Alistair Darling said yesterday all banks in the U.K. awarding discretionary bonuses of more than 25,000 pounds ($40,000) must pay a one-time levy of 50 percent.

President Nicolas Sarkozy is to follow Britain’s lead and impose a one-off tax on bonus pay-outs by banks operating in France. The French government intends to include the 50 per cent tax in the budget bill going through parliament. It will be levied on bonuses above €27,000 and will be paid by the banks, bringing Paris in line with London. France and the UK want similar one-off taxes to be adopted across the European Union.

He was a symbol of French fashion, the creator of clothes illuminated by the colours of his native Provence and by his extraordinary artistic talents. But yesterday, the house of Christian Lacroix was reduced to little more than a small trading office as it crumbled under the weight of debts and losses, The Australian reported. After six months in administration amid a desperate search for a saviour, Lacroix was forced to abandon haute couture as the Paris Commercial Court approved a restructuring plan.

Renault SA and other shareholders of troubled Russian car manufacturer Avtovaz said Friday that they have agreed on an overhaul of the company that includes debt restructuring and a new product plan, MarketWatch reported. The memorandum of understanding between the shareholders was signed in Paris on Friday at a ceremony attended by Russian Prime Minister Vladimir Putin, whose presence underscored the political importance of Avtovaz. The shareholders of Avtovaz are the state-controlled corporation Russian Technologies, the Russian bank Troika Dialog and France's Renault.

The Paris Commerce Court has postponed a decision on the future of troubled French fashion house Christian Lacroix to Dec. 1, the administrator for Lacroix said on Tuesday. This was because the main potential buyers for the fashion house, Gulf investor Hassan bin Ali al-Nuaimi, and France's Bernard Krief Consulting, "could not show the documentation certifying the funds needed for the acquisition were available," Regis Valliot said. If by the Dec.