Headlines

Serbia will not ask the International Monetary Fund to let it continue protecting indebted state-operated firms from creditors, Prime Minister Aleksandar Vucic said on Wednesday, reversing government policy, Reuters reported. An IMF mission this week started its review of Serbia's 1.2 billion euro ($1.36 billion), three-year precautionary loan deal, which, amongst other things, envisions the state selling or reforming a number of unprofitable and indebted companies.

Banks need to shake up bonus-heavy pay structures and attack corporate cultures that encourage excessive short-term risk-taking, the head of the International Monetary Fund warned on Wednesday. Christine Lagarde, IMF managing director, said much had been done on the regulatory front since the 2008 global financial crisis to crack down on banks and bankers and avoid a repeat of the turmoil, the Financial Times reported. But she warned, in a Washington speech , that risks to financial stability were still elevated and the “culture” of the financial sector was at least partly to blame.

The European Central Bank will decide after next week’s meeting of euro region finance ministers whether to tighten Greek access to emergency liquidity, two people familiar with the matter said, Bloomberg News reported. The ECB is prepared to raise the discount demanded on Greek collateral to a level last seen in 2014 unless the country’s government shows a willingness to compromise in bailout talks, said one of the officials, who spoke on condition of anonymity. An ECB spokesman declined to comment.

Investors still wondering how Kaisa Group Holdings Ltd. doubled its debt in six months and triggered China’s first property bond default may want to read page 63 of its 2014 interim report. There, in footnote No. 15 of the Shenzhen-based company’s balance sheet, is a reference to 11 billion yuan ($1.8 billion) in advance deposits for property projects from third parties and for 1.15 billion yuan that needed to be refunded, Bloomberg News reported. At issue is whether these deposits were initially classified properly as current liabilities on Kaisa’s books.

Italian businessman Philippe Camperio is spearheading efforts to rescue troubled luxury hat maker Borsalino after it lost millions of euros in 2013, the company said on Wednesday, Reuters reported. In March the hat maker, which has helped clothe politicians, celebrities and movie stars the world over, said it was looking at ways to stay afloat after running into financial straits.

A group campaigning for the reduction of variable mortgage rates will call for a legal cap on the amount banks can charge borrowers at a meeting in Dublin on Thursday evening, the Irish Times reported. The SVR Campaign, led by consumer advocate Brendan Burgess, is hoping to get Irish based banks to reduce their mortgage rates. One of the suggestions to be proposed as a way of achieving this is for the government to apply a cap of 3 per cent on the amount banks can charge standard variable rate (SVR) customers.

U.S. Steel has issued a thinly veiled threat to shut down parts of its Canadian operations if its claim to be owed $2.2 billion by its struggling Canadian arm is not allowed, The Hamilton Spectator reported. In court documents filed this week, the company says objections to its claims threaten to slow the restructuring process it says must be complete by mid-summer if it is to avoid losing its critical auto contracts. At issue are objections by the Ontario government, the United Steelworkers, retirees and a former Stelco president to the parent company's claims.

Moldova will step up an investigation into the disappearance of more than $1 billion from three banks, the head of the central bank told Reuters on Tuesday, after around 10,000 people protested over the scandal at the weekend. Last year Moldova placed Banca de Economii, Banca Sociala and Unibank under central bank administration after a series of non-performing loans bankrupted the lenders, which together account for up to 20 percent of the tiny former Soviet republic's banking system in terms of assets.

Greece blamed its creditors for the failure to end the impasse over its fiscal crisis as government bonds slumped and the European Central Bank weighs how much more liquidity to offer its financial system, Bloomberg News reported. No deal will be possible until the European Commission and the International Monetary Fund reduce the number of red lines they’re demanding, a government official said on Tuesday. The comments clouded the outlook for bailout talks, which some officials had said were making progress, and accelerated a selloff in the country’s stocks and bonds.

For years, Venezuela has had a hole in its pocket, a very big hole. The government’s complex currency system has led to exorbitant schemes by importers, who wildly inflate the value of goods brought into the country to grab American dollars at rock-bottom exchange rates, the International New York Times reported. Sometimes, they fake the shipments altogether and import nothing at all. Then they just pocket the dollars that the government provides, or sell some of the money for a gargantuan profit on the soaring black market here for American currency.