Headlines

A Brazilian court has approved a bankruptcy protection petition filed by MMX Sudeste Mineracao SA, an iron-ore mining company controlled by Brazilian tycoon Eike Batista, the company said on Wednesday in a securities filing, Reuters reported. It was the third time in a year that a unit of the former billionaire's EBX industrial group has sought protection from creditors. The decision was taken by a court in Belo Horizonte in the Minas Gerais state. MMX Sudeste made the request after negotiations with creditors and efforts to seek new investors failed, MMX said in a filing on Oct. 15.

Bulgaria's central bank will have to revoke the licence of Corporate Commercial Bank (Corpbank) unless the Balkan country changes its laws, the central bank's spokesman told Reuters on Wednesday. Under current laws, if a bank's capital is negative, the central bank should withdraw the bank's licence, shut its operations and seek its bankruptcy within five working days. "Under current legislation the Bulgarian National Bank has no other option but to revoke the bank's licence.

South Africa will sacrifice economic expansion in the next two years by limiting spending growth and raising more taxes as it seeks to avoid a debt trap, Bloomberg News reported. The government will cut its expenditure limit by 25 billion rand ($2.3 billion) and plans 27 billion rand of “structural increases” in revenue in the period, the National Treasury said in the mid-term budget released in Cape Town today. “We have reached the turning point,” Finance Minister Nhlanhla Nene told reporters before his budget speech to Parliament.

HSBC Holdings Plc (HSBA) Chairman Douglas Flint said separating his bank’s securities arm from its consumer unit may cost as much as 2 billion pounds ($3.2 billion), Bloomberg News reported. “Ringfencing will cost one billion, two billion to implement, which is a structural separation that is going to be very expensive,” Flint told the House of Lords’s European Union Economic and Financial Affairs Subcommittee in London today. British lenders must build firewalls between their consumer and investment banks by 2019 to meet rules proposed by John Vickers’s Independent Commission on Banking.

LDK Solar Co., the Chinese solar-cell maker that defaulted on its bonds this year, filed for bankruptcy in the U.S. to help carry out restructurings already under way in Hong Kong and the Cayman Islands, Bloomberg News reported. Xinyu, China-based LDK filed for Chapter 15 protection today in Wilmington, Delaware, listing about $1.13 billion in debt and $510 million in assets as of May 31. Chapter 15 is the section of the bankruptcy code used by foreign companies restructuring abroad to fend off creditors and distribute payments in the U.S.

The European Union’s banking watchdog has warned that Bulgaria’s authorities have breached European law by continuing to block depositors’ access to their money at a large troubled lender the government seized four months ago, the International New York Times reported. The warning comes after a run on deposits forced the lender, Corporate Commercial Bank, to close in June, leaving tens of thousands of consumers and businesses without access to their cash in the European Union’s poorest member state.

Regulators in Portugal and Britain have temporarily banned short-selling of Portugal Telecom’s stock after the company’s shares declined to a record low on Monday over its exposure to a company with ties to the Espírito Santo family, the International New York Times DealBook blog reported. The Portuguese securities regulator, the Comissão do Mercado de Valores Mobiliários, temporarily restricted short-selling of Portugal Telecom late Monday, citing the company’s 10 percent drop in its share price that day.

Permanent TSB, which is 99.2 per cent owned by the State, is expected to announce details of its capital-raising plan on Sunday after the European Central Bank publishes the results of its pan-European comprehensive assessments, which PTSB is expected to fail, the Irish Times reported. It is not clear how much capital PTSB will be required to raise but the expectation is it will be below €1 billion.

Womenswear retailer Boutique Jacob Inc. is abandoning its restructuring efforts and closing all its 92 stores in Canada, the Chronicle Herald reported on a Canadian Press story. The Montreal-based clothing chain says efforts over the last few months to “try to breathe new life into the company” have failed. The insolvent retailer has been liquidating inventory at its Canadian stores since filing for protection under the Companies’ Creditors Arrangement Act in May. It says it will proceed with selling all of the remaining merchandise at its stores and online at Jacob.ca.

Portugal's Novo Banco -- the successor to bailed-out Banco Espirito Santo (BES) -- has moved closer to a rescue deal for its Angolan unit, with the African nation's central bank agreeing a recapitalisation plan for the local business, Reuters reported. Novo Banco will retain a 9.9 percent stake in BES Angola (BESA) under a deal which will see some of its loans to the unit converted into equity, the National Bank of Angola said on Monday.