Headlines

An increase in Cyprus's corporate tax rate is under consideration as part of negotiations over a proposed official bailout for the island, according to three people with knowledge of the talks, The Wall Street Journal reported. Cyprus's troika of would-be official creditors—the European Central Bank, European Commission and International Monetary Fund—is pressing Nicosia to raise its corporate tax by up to three percentage points from 10% now, the officials said.

British banks have been suffering amid dismal earnings, scandals and regulatory investigations, but three of the country’s largest financial firms handed out seven-figure pay packages to hundreds of employees last year, The New York Times DealBook blog reported. The disclosures this week add to the growing debate over compensation, as regulators look to rein in bankers’ pay.

More Dutch companies declared bankruptcy in February than at any time since records began in 1981, the Associated Press reported. The country's Central Bureau for Statistics also says Monday that on a three-month average, bankruptcies are at their highest level on record: around 680 per month, not counting one-person businesses. The Dutch economy is struggling as the government cuts spending and increases taxes to meet European budget rules that require countries to get their budget deficits down to 3 percent of their annual gross domestic product.

Greater social justice, higher taxes for the wealthy, and a statutory minimum wage will be at the heart of a left-leaning election campaign by Germany’s Social Democrats bidding to unseat Angela Merkel, the German chancellor, in September’s general election, the Financial Times reported. The programme, including stricter regulation of banks and other financial institutions, and statutory quotas for the appointment of women as company directors, was unanimously approved by the Social Democratic party executive meeting in Berlin on Monday.

Egypt may qualify for an International Monetary Fund bridge loan of more than $700 million a year that could help Cairo stave off collapse of its crisis-stricken economy, an IMF official said on Monday, The Wall Street Journal reported. "Egypt needs bold and ambitious policy actions to address its economic and financial challenges without further delay," IMF spokeswoman Wafa Amr said.

Britain will resist calls to impose far stricter rules on how much banks can leverage their capital for investments and lending, insisting that there is no need to do so before 2018, Reuters reported. The government is forcing banks to limit leverage to 33 times their capital, in line with international regulations, and rejected a call on Monday from a panel of parliamentarians to stiffen the rules to curb risk-taking even more.

Talks between Greece and a delegation of international inspectors are set to enter a second week after bogging down in a spat over public-sector layoffs, setting back government hopes for a speedy review of its reform program, The Wall Street Journal reported. Government officials signaled on Sunday that representatives from the European Commission, European Central Bank and International Monetary Fund, known as the troika, were expected to stay in the Greek capital for several more days to discuss plans to shrink Greece's bureaucracy.

Banks across Europe are racing to amend executive pay deals by the end of the month in an attempt to adhere to new EU bonus rules and secure shareholder approval at upcoming annual meetings, the Financial Times reported. “It couldn’t be a more difficult time,” said one remuneration committee member whose bank’s annual meeting is looming in May. “Our lawyers thought they had all the paperwork done and signed off.

Britain should force all banks to split routine retail operations from riskier investment activities if a single lender abuses new rules designed to protect taxpayers, an influential panel of lawmakers said, Reuters reported. The Parliamentary Commission on Banking Standards, which has been asked to find ways to reform banks, also said on Monday that Britain's financial regulator should be given the responsibility to decide how far banks can leverage their capital for investment and lending. The government's Banking Reform Bill is due to be debated in parliament on Monday.

President Nicos Anastasiades of Cyprus will ask Athens to hand over €2bn from its own bank recapitalisation package to rescue Cypriot banks with operations in Greece, say officials in Nicosia, the Financial Times reported. The unusual request comes as Cypriot officials desperately try to avert a so-called haircut of bank deposits held on the island as part of a proposed €17bn bailout being negotiated with the EU and International Monetary Fund.