Headlines

Switzerland's Banque Heritage said on Wednesday it would take on client assets from wealth manager Bank Hottinger, which regulators put into bankruptcy last month, Reuters reported. The agreement is expected to be among a host of deals and closures in the Swiss banking industry, as an international crackdown on tax avoidance and costly regulation put pressure on banks, many of whom had relied on Switzerland's bank secrecy rules. Consultancy KPMG has estimated the number of Swiss private banks will fall to fewer than 100 in the next three years from around 130 now.

Creditors of integrated steel producer Essar Steel Ltd may consider conversion of debt into equity under the strategic debt restructuring (SDR) route should the company not succeed in its attempt to monetize assets or bring on board a strategic investor, two people familiar with the matter said. The SDR scheme, introduced by the Reserve Bank of India in June, allows lenders to convert debt into majority equity holding and take over the management of a company. The bankers then have 18 months to find a suitable buyer.

Top European Union officials warned three countries on Tuesday that their budgets for next year risk violating the bloc’s spending rules, while they said that it is too soon to assess the impact on France’s budget of higher security spending in response to the recent terror attacks in Paris, The Wall Street Journal reported.

Greece and its international creditors said on Tuesday that they had reached agreement on the country’s next round of economic changes, a deal that is meant to unlock as much as 12 billion euros, or about $13 billion, in loan money, the International New York Times reported. Athens had initially hoped the money would be dispensed after the Greek Parliament passed a package of economic measures last month. But eurozone finance ministers said then that the steps did not fully meet the conditions required for the next milestone payment from the country’s €86 billion bailout package.

Despite a sharp slowdown in economic growth and the stock market crash, consumers in China’s commercial capital have proven resilient, according to FT Confidential Research, a research service from the Financial Times. A survey of consumers across the city found they spent an average Rmb4,959 a month over the past 12 months, compared with Rmb1,737 across urban areas nationwide. They increasingly favour a quality meal and foreign goods, while nearly 70 per cent said they travelled abroad during the past 12 months. But cracks are appearing in the Shanghai consumer story.

The arrests or investigations targeting the finance industry in the aftermath of China’s summer market crash have intensified in recent weeks, creating a climate of fear among China’s finance firms and chilling their investment strategies. At least 16 people have been arrested, are being investigated or have been taken away from their job duties to assist authorities, according to statements and announcements compiled by Bloomberg News.

The British government announced Tuesday a deal that would see London hand over an unprecedented array of powers—including around planning, transport and employment—to a local government encompassing Liverpool and five surrounding municipalities, The Wall Street Journal reported. The British government also said it would provide £900 million ($1.4 billion) for local investment over 30 years, which will be used to turn Liverpool’s recently revamped port into a hub for trade from the expansion of the Panama Canal, set to finish next year.

Allied Irish Banks is on the brink of issuing its first subordinated bond since being nationalised after the financial crisis, reaching a key milestone in its recovery. The euro Tier 2 bond will be the bank's first attempt at a public subordinated offering since it imposed severe losses on subordinated debt investors during the height of the eurozone financial crisis. The bank was bailed out in 2009 and fully nationalised in 2010. "It really is an important trade for them," said Chris Agathangelou, head of EMEA FIG syndicate at Nomura. "If it goes well, it sets up their whole capital plan.

Banks facing a surge in defaults on small company loans are closing off credit to the sector in the United Arab Emirates, in a sign of the increasingly brittle business confidence in the Gulf amid a sustained slump in oil prices, the Financial Times reported. AbdulAziz al Ghurair, head of the UAE Banks Federation, estimated loans to small and medium-sized enterprises totalling between Dh5bn and Dh7bn ($1.36bn-$1.9bn) were at risk of default after the country’s national body that pools information on banks’ loan exposure revealed over-borrowing by SMEs.

Russia has proposed a restructuring of the $3bn bond owed to it by Ukraine, an about-turn from Moscow’s earlier insistence of full repayment next month, the Financial Times reported. The move offers a glimmer of hope that Russia and Ukraine can avoid a legal clash over the debt — a threat raised after Russia refused to participate in the $18bn restructuring deal Kiev reached with other creditors a month ago. However, question marks hang over the Russian offer as President Vladimir Putin made clear that he expects the International Monetary Fund to guarantee the debt.