Headlines

A capital gains tax on housing sales was intended to cool China’s sizzling property market, but since it was announced last Friday it has had the exact opposite effect: a panic has been unleashed, the Financial Times reported. Sales have spiked and prices have increased as buyers try to close deals before the 20 per cent tax goes into effect. There has also been a jump in divorces, a practical if rather hard-hearted strategy for exploiting a loophole in the rules.

Bondholders who snubbed an aggressive tender offer from Santander last year have been rewarded, following a more generous and investor-friendly approach for the same bonds from the Spanish bank, Reuters reported. Santander on Wednesday launched an any-and-all buyback offer for a maximum of just over USD12bn in subordinated bonds as it seeks to boost its capital ratios. "Bondholders that balked at Santander's unmodified Dutch auction liability are now being offered a more straightforward offer with a higher premium," said a banker.

For the first time in a year, Canada’s central bank on Wednesday signalled comfort with the trajectory of household debt, a shift that will allow policy makers to focus more tightly on signs of deteriorating economic growth, The Globe and Mail reported. In a revised policy statement, the Bank of Canada dropped language that was intended to signal a willingness to raise borrowing costs to curb a surge in household borrowing to record levels.

Property investors Brian and Mary Patricia O’Donnell have lost their bid to get a High Court judge in London to reverse his decision in December refusing them the right to go bankrupt in the UK, rather than in the Republic, the Irish Times reported. Mr Justice Guy Newey in the High Court in the Royal Courts of Justice said that only “exceptional circumstances” would justify the reopening of a decision already made, particularly when the issues had been heard at a full trial.

The British government stood isolated on an important European Union issue Tuesday after finance ministers from elsewhere in the bloc rejected its effort to water down proposed limits on bankers’ bonuses, the International Herald Tribune reported. The ministers, taking up rules provisionally approved last week by representatives of the European Parliament and member states, broadly agreed on Tuesday to cap bonuses at no more than the annual salary for bankers working in the 27-nation European Union and for those working for European-based banks worldwide.

Egypt is at risk of a "revolution of the hungry" two years after Hosni Mubarak was ousted in a popular uprising, as food and energy prices will soar with or without an IMF deal, Reuters reported in an analysis. Failure to get the $4.8 billion (£3.17 billion) loan or some other funding would have dire consequences: if Egypt keeps burning foreign currency at the rate it has done since the 2011 uprising, it will have none left in little more than a year. But success would also stir Egypt's boiling social and political cauldron.

An Afghan special tribunal convicted and sentenced two former executives and 19 others for roles in the fraud that led to the collapse in 2010 of Afghanistan's largest private bank, but in a surprise decision threw out the most serious charges, The Wall Street Journal reported. Former Kabul Bank Chairman Sherkhan Farnood and former Chief Executive Khalilullah Ferozi were convicted of fraud at the bank and given five-year prison sentences, the court said Tuesday.

The Central Bank of Ireland met with the country’s main lenders yesterday to begin a process that it hopes will lead to a voluntary framework on how “multi-borrowed distressed borrowers” are dealt with by credit institutions, the Irish Times reported. This will encompass the thorny issue of mortgage arrears, which is the biggest source of debt for many individuals. The regulator is seeking to agree a set of “general principles” that would be applied by lenders when dealing with borrowers who are in arrears with their repayments and owe money to a number of institutions.

India has accused Cadbury PLC of dodging about $46 million in taxes by pretending to produce candy at a factory that didn't exist. A 103-page report by the country's tax authorities, which was reviewed by The Wall Street Journal, accuses Cadbury's Indian unit of manipulating invoices and other documents to get a tax exemption available to companies that began production in new plants in the northern Indian state of Himachal Pradesh by March 31, 2010.

Bosnia's BH Airlines has been grounded and faces possible bankruptcy over an outstanding bank debt, a senior government official said on Tuesday, Airwise reported on a Reuters story. The Sarajevo-based carrier is solely owned by Bosnia's autonomous Muslim-Croat Federation, after Turkish Airlines pulled out of a joint venture in June last year and handed its 49-percent stake over to the government.