Headlines

Italian voters delivered a rousing anti-austerity message and a strong rebuke to the existing political order in national elections on Monday that threatened to plunge the country into political paralysis after early results failed to produce a clear winner, the International Herald Tribune reported.

Spanish retail bank Caixabank SA said Monday it plans to cut 3,000 jobs as it adapts to a deep economic downturn and the recent takeovers of two smaller rivals, Dow Jones reported. The Barcelona bank said in a press release that it has started a negotiation period with labor unions on how to carry out the cuts, which it said are "necessary to adapt to the current environment and improve efficiency." Spain's banking sector has been shrinking for the past two years in the wake of the bust of a massive real estate bubble.

European policymakers are split over how to handle a bailout of Cyprus, with Germany and some other countries pushing for bank depositors to bear part of the cost and many other member states worried such a move will cause a bank run, Reuters reported. Euro zone officials say momentum has built in recent days behind the idea of "bailing-in" Cypriot bank shareholders and depositors, although the specifics of how such an operation would be carried out have not been pinned down.

Park Geun-hye took office as South Korea’s first female president on Monday promising to provide a fairer distribution of wealth for the people whose “blood, toil and sweat” formed the foundation of the nation’s prosperity, the Financial Times reported. Speaking before about 70,000 people outside parliament, the daughter of former military dictator Park Chung-hee said she would “open a new era of hope” to allow all citizens “to enjoy the benefits of economic development”.

Any idea that has bankers up in arms and America, of all places, whingeing about intrusive lawmaking must have something going for it, right? Wrong. The European Commission’s proposals for a financial-transactions tax (FTT), published on February 14th, are a masterpiece of bad design, The Economist reported in a commentary. A group of 11 European Union member states, among them France, Germany and Italy, wants to impose a 0.1% tax on equity and debt transactions, and a 0.01% charge on derivatives transactions.

Receivers have been appointed to Becton Property Group after the company failed to reach an agreement with its consortium of bankers led by Goldman Sachs, The Australian reported. Goldman Sachs and consortium partner Fortress Investment Group have called in two major loans to Becton totalling $200 million. That move has placed the listed headstock Becton Property Group Ltd and associated entities Becton Pty Ltd, Becton Group Holdings Pty and Becton Construction Group Pty Ltd into receivership.

The U.K. late Friday saw its triple-A credit rating from Moody's chopped one notch to Aa1. The news isn't as bad as it might have been: importantly, Moody's has assigned a stable outlook. But it is a political blow for Chancellor George Osborne and probably means the slide in sterling and rise in gilt yields that is under way will continue, The Wall Street Journal Heard on the Street blog reported.

Italy voted on Sunday in one of the most unpredictable elections in years, with many voters expressing rage against a discredited elite and doubt that a government will emerge strong enough to combat a severe economic crisis, Reuters reported. "I am pessimistic. Nothing will change," said Luciana Li Mandri, 37, as she cast a ballot in the Sicilian capital Palermo on the first of two days of voting that continues on Monday.

European banks plan to pay back €61 billion ($81 billion) of emergency central-bank loans they took out last year, a smaller-than-expected amount that highlights the continued fragile state of the Continent's financial system, The Wall Street Journal reported. The planned repayments by 356 lenders come after banks a month ago paid back €137 billion of the cheap, three-year loans—a surprisingly large figure. But the size of the latest repayment, which was announced by the European Central Bank on Friday, was only about half what many analysts had expected.

The European Commission is “closely monitoring” Ireland’s credit union sector, EU commissioner Olli Rehn said, as a report warned that credit unions could have a negative impact on the country’s deficit in the coming years, the Irish Times reported. The European Commission’s winter economic forecast published yesterday predicts that Ireland’s fiscal deficit is expected to come in at 7.3 per cent of GDP this year and 4.2 per cent next year, but these figures could be increased due to financial sector support measures, including the resolution of certain credit unions.