Headlines

Mario Draghi on Thursday finally unveiled the European Central Bank’s plan to revive the eurozone’s dormant securitisation market, which the central bank hopes can help to turn around the region’s economic fortunes, the Financial Times reported. The ECB will start to buy packages of sliced and diced loans, known as asset-backed securities (ABS), in big quantities from next month.

Spurred by a rapidly deteriorating economy, the International Monetary Fund has approved a three-year extended credit facility worth $552 million with Yemen, the impoverished Arab nation that has become a breeding ground for the terrorist group al Qaeda in the Arabian Peninsula, The Wall Street Journal Middle East RealTime blog reported. The lifeline will provide some relief for Yemeni authorities who face a myriad of political and security challenges that continue to drag on the economy.

It was an odd sort of rallying cry. Just after Sadakazu Tanigaki’s appointment as secretary-general of Japan’s ruling Liberal Democratic party on Wednesday, the former finance minister said that taxes on consumption should go up again next year, according to the law passed two years ago, the Financial Times reported. Higher taxes “contribute to fiscal stability and help expand policy options”, he said, noting only that “side-effects” should be monitored.

The European Central Bank’s landmark review of euro zone banks will have to ask lenders to raise an additional €51 billion to be credible with markets, a Goldman Sachs survey of large institutional investors has found, the Irish Times reported. The survey of 125 institutional investors from across the world also found that nine of the 130 banks being tested were expected to fail, with capital shortfalls most likely at Italian, German and Greek banks, according to a document circulated by Goldman Sachs last night.

Dubai mortgage lender Amlak Finance said on Wednesday that it would hold a shareholder meeting on September 21 to discuss its restructuring plan and a proposed issue of equity-linked bonds, Arabian Business reported. Creditors of the company, whose shares have been suspended since late 2008 after it was hit by a local real estate crash and the global financial crisis, last month approved a plan to restructure debts worth around $2.7 billion.

Irish Finance Minister Michael Noonan said his government’s campaign to sell stakes in Irish banks to the euro-area bailout fund is less of a priority now that the holdings are worth more, Bloomberg News reported. A deal with the European Stability Mechanism “is not as attractive a deal any more because our bank shares have become very valuable,” Noonan said in an RTE Radio interview today. A gradual sale of shares in 99.8 percent state-owned Allied Irish Banks “over time to the market” is probably a better way to lower state debt, Noonan said.

A Swiss financial regulator said on Wednesday that it had initiated enforcement proceedings against a Swiss bank with ties to the Espírito Santo family’s troubled group of companies, the International New York Times DealBook blog reported. The Swiss Financial Market Supervisory Authority, or Finma, said it was investigating the role of Banque Privée Espírito Santo in the distribution of securities and financial products of one of the family companies.

The number of buy-to-let mortgage accounts in arrears is continuing to increase despite rising rents in Dublin and elsewhere, the Irish Times reported. The latest figures from the Central Bank, however, show the number of homeowners in arrears has fallen again. Nonetheless, this improvement masked an increase in very long-term arrears, with the number of those behind in their repayments by two years or more continuing to rise. The figures for the second quarter of this year indicate mortgage arrears linked to investment properties remains a key problem for the banks.

Japanese chipmaker Renesas Electronics may cut more jobs as it finishes a massive restructuring that is focusing its business on the automotive and industrial sectors and has pulled it back into the black after years of losses, Reuters reported. Remaining steps will focus on selling factories and exiting businesses announced in a 2012 restructuring framework, updated a year ago, with about 40 percent of the plan still to be implemented, Renesas Chairman and CEO Hisao Sakuta told a media round table on Tuesday. "To be honest, maybe we still have slightly too many people," Sakuta said.

Finance Minister Michael Noonan will hold a series of talks in Brussels on Monday and Tuesday about renegotiating bailout loans from the International Monetary Fund, Independent.ie reported. Mr Noonan has said taxpayers could save up to €375m per year if the State was able to pay-off a share of the IMF portion of the €67.5bn bailout. Any deal needs support from several quarters in Brussels but would give the Finance Minister plenty of scope to cut taxes in next month's Budget.