Headlines

A German court started insolvency proceedings for the co-owner of London's landmark Gherkin tower, German property group IVG Immobilien, which will continue to reorganise under its own administration, Reuters reported. IVG plans to submit a plan for its reorganisation to the court prior to Christmas and schedule a vote for its creditor committee in January, the company said on Friday. Should both agree to the plan, which would likely involve a debt-for-equity swap, it could exit the insolvency proceedings in the first half of next year as planned.

Portuguese lawmakers on Friday approved an unpopular austerity package for next year, as the country seeks to regain investor confidence to exit its €78 billion ($105 billion) international bailout in June, The Wall Street Journal reported. Outside parliament, several thousand people protested against what will be another year of sharp spending cuts and high taxes. But there are signs of fatigue among protesters, and demonstrations have been small in recent weeks.

Brazil plans to reduce lending by its development bank by about 20 percent next year to shore up finances after a wider-than-expected September deficit fueled speculation the nation’s credit rating may be cut, Bloomberg reported. Finance Minister Guido Mantega said in an interview yesterday that state lender BNDES will provide about 150 billion reais ($66.6 billion) of loans in 2014, compared with an estimated 190 billion reais this year.

Against expectations, the number of company liquidations in England and Wales has fallen by 2.6% over the past three months, the latest statistics from the Insolvency Service reveal, Economia reported. There were 3,875 compulsory liquidations and creditor’s voluntary liquidations during Q3 2013, which is also down by 2% when compared to the same quarter in 2012. Individual insolvencies were also down by 7.3% on the same period last year but up slightly when compared to Q2. The numbers rose from 25,717 to 26,030 in Q3.

The loan exposure of Brazil's two largest private-sector banks to former billionaire Eike Batista's debt-laden Grupo EBX is falling, UBS Securities said in a report, signaling that the risk of additional bad loan provisions or significant writedowns is declining, Reuters reported. Collateral put forth by Batista and EBX, a mining, energy and logistics conglomerate, is proving enough to reduce the probability of losses at Itaú Unibanco Holding SA and Banco Bradesco SA, London-based strategist Philip Finch said in a client note.

Royal Bank of Scotland is expected to confirm on Friday that it is to create a “bad bank” with more than £30bn of assets following a review of its operations ordered by the Treasury, The Telegraph reported. The taxpayer-backed lender is set to say that a new internal, but separately managed, bad bank is being established to deal with the legacy of its toxic assets - the least disruptive of three break-up options being looked at for the bailed-out bank.

China’s swelling local-government debt is spurring speculation that authorities could sell some of their holdings of listed shares, estimated by UBS AG to total at least 5 trillion yuan ($820 billion), to make repayments, Bloomberg reported. Partial divestment of governments’ stakes in state-owned companies is one option to address the debt issue, said Yao Wei, China economist at Societe Generale SA in Hong Kong. Local governments have already made some sales over the past two years and repayment pressures mean that more are likely, said Chen Li, a Shanghai-based analyst at UBS.

Insolvent German home improvement retailer Praktiker has attracted a second offer for its stores, this time for more of the shops, two people familiar with the situation said, Reuters reported. The bid comes as talks over the acquisition of Praktiker's upmarket unit Max Bahr by rival Hellweg are already approaching a final stage. The new bid comes from Praktiker's own management with the backing of a group of funds and would see 175 Praktiker and Max Bahr stores being taken over, the sources said.

The economic recovery in the euro zone is feeble. Employment continues to suffer. And the patient is likely to be getting around on crutches for months if not years to come. That was essentially the prognosis from two key economic indicators published Thursday and from economists assessing the latest conditions, The International New York Times reported. The number of people out of work in the countries using the euro currency rose slightly in September, while inflation fell more than expected — both signs of a weak economy.

OGX Petróleo e Gas Participações SA, the beleaguered Brazilian oil company controlled by former billionaire Eike Batista, said on Thursday it expects to end up in arbitration over a deal struck with Malaysian state oil company Petronas, Reuters reported. The day after filing for bankruptcy, OGX said in a securities filing that it had struck a deal with Petronas in the middle of this year for which it should have received about 1.9 billion reais ($869 million).