Headlines

The pound slumped in late trading on Tuesday, firmly establishing sterling as the worst major performing currency this year as investors grow increasingly alarmed at the prospect of a severe rupture between the UK and EU, the Financial Times reported. Traders warn that a disorderly sell-off in the pound poses a major challenge for the Bank of England as it spurs inflation and ultimately prevents a further easing in its monetary policy that can offset weaker growth in the economy.

Good news coming out of the dismal mess of the Greek economy and its international bailout has been a rare commodity over the past six years, the Financial Times reported in a commentary. So it is tempting to celebrate the decision of the eurogroup of finance ministers that Athens has done enough structural reform to receive the latest €2.8bn tranche of its bailout. In practice, a quiet measure of relief would be more appropriate than unbridled joy.

Ahead of a multibillion-dollar bond issue, Saudi Arabia warned investors of the challenges that cheap oil poses to its economy and said it would take 70 years to sell all of its oil, prompting concerns that some of it could go unrealized, The Wall Street Journal reported. The disclosures—included in the government’s bond prospectus issued on Tuesday—raise questions over the ability of the oil-dependent kingdom to quickly turn around its economic fortunes after more than two years of low crude prices.

Finance firms that help keep cash flowing to China’s towns, cities and provinces face rising risks of landmark bond defaults just as they turn to global markets for funds, Bloomberg News reported. China’s economic slowdown is weighing on revenue at regional governments, hampering their ability to support the 5.3 trillion yuan ($789 billion) of outstanding onshore notes from local-government financing vehicles, which have yet to suffer nonpayments. Such issuance fell 18 percent last quarter as regulators curbed sales, forcing some to seek funds overseas.

Greece has completed a set of key economic overhauls, eurozone finance ministers agreed Monday, marking the end of the first review of its fiscal bailout and clearing the way for disbursement of new loans to Athens, The Wall Street Journal reported. The ministers, who were here for their monthly meeting, gave their blessing to €2.8 billion ($3.12 billion) in the next stage of financial aid, but they stopped short of signing off on it immediately.

Deutsche Bank was given special treatment in the summer stress tests that promised to restore faith in Europe’s banks by assessing all of their finances in the same way, the Irish Times reported. Germany’s biggest lender, whose share price fell as much as 22 per cent in recent weeks on fears of a $14 billion US fine, has been using the results of the July stress tests as evidence of its healthy finances. But the Financial Times has learnt that Deutsche’s result was boosted by a special concession agreed by its supervisor the European Central Bank (ECB).

Prosecutors charged two former private bankers Monday with forgery and other criminal charges in the latest legal salvo related to the alleged misappropriation of billions of dollars from Malaysian state development fund 1MDB. Yak Yew Chee, 57 years old, and Yvonne Seah, 45, were charged in Singapore’s state courts with three counts each of forgery and four counts each of failing to report suspicious transactions between 2012 and 2014, during their employment by the Singapore branch of Swiss private bank BSI SA. Mr.

Dongbei Special Steel Group Co Ltd has formally entered into a bankruptcy restructuring process following a court filing by one of its creditors, official news agency Xinhua reported on Monday. Dongbei, owned by the Liaoning provincial government in the country's "rustbelt" northeast, has been at the heart of troubles in China's debt market this year, defaulting on nine separate bonds even as Beijing has vowed to crack down on "zombie" firms with perennial losses and too much debt.

Brazil’s federal prosecutors on Monday filed new corruption charges against former President Luiz Inácio Lula da Silva, this time for allegedly using his influence to obtain government loans for a Brazilian construction company in exchange for kickbacks paid to his nephew, prosecutors said. Mr. da Silva was charged with corruption, money laundering, influence peddling and conspiracy. If found guilty of the charges, Mr. da Silva, who led Brazil from 2003 to 2010, could face up to 35 years in prison. A judge in Brasília would have to accept the charges for Mr. da Silva to face trial.

KBC Bank Ireland has been fined €1.4 million by the Central Bank for breaches of the Code of Practice on Lending to Related Parties, which may include directors, senior managers, significant shareholders of the bank and spouses or domestic partners, the Irish Times reported.