Headlines

Korean total household debt rose to a record 937.5 trillion won in the third quarter, undermining Park Geun Hye’s election promise to expand the middle class after she takes over the presidency next week. The debt reached 164 percent of disposable income in 2011, compared with 138 percent in the U.S. at the start of the housing crisis, according to Royal Bank of Scotland Group Plc, Bloomberg reported.

There is a "material and rising risk" that Cyprus will default on its sovereign debt, especially if the euro zone and International Monetary Fund do not come up with aid, rating agency Standard & Poor's said on Wednesday, Reuters reported.

The Bundesbank has reported that the effects of the 2008 Lehman Brothers collapse will be minimal for central banks in the eurozone. Patience in unloading legacy assets has paid off, the institution announced, Deutsche Welle reported. On Wednesday, Germany's Bundesbank announced that eurozone central banks stood a good chance of getting off lightly after the spectacular 2008 Lehman Brothers collapse, which plunged global financial markets into a deep crisis.

Axminster Carpets, the manufacturer whose luxury carpets have graced Britain's stately homes and palaces since the eighteenth century, is calling in the administrators, joining a growing list of businesses seeking rescue to avoid collapse, Reuters reported. The 250-year old company, which employs around 400 people, said on Wednesday it would continue to trade while it explores all potential restructuring operations. Axminster was named after the hometown of its founder Thomas Whitty, who started making carpets in 1755.

Reyal Urbis SA, a real-estate firm that became a stock-market darling before Spain's property boom went bust, said it would file for bankruptcy protection in what could become the second-largest default in Spanish corporate history, The Wall Street Journal reported. The firm, born of the merger of Inmobiliaria Urbis and Construcciones Reyal a year before the real estate crash of 2008, said in a statement Tuesday that it expects to reach an agreement with its creditors.

European banks are facing the threat of having to reveal their taxes and profits on a country-by-country basis in the latest twist to the EU negotiations over rules to make banks safer, the Financial Times reported. The European parliament is pressing for the tougher disclosure regime along with a demand for strict curbs on bankers’ bonuses as part of the law implementing the Basel III international accord.

B.C. Finance Minister Mike de Jong has resorted to corporate and personal income taxes hikes for the first time in his party’s 12 year reign, on the eve of an election that threatens to unseat the B.C. Liberal government, The Globe and Mail reported. In his quest to deliver a $197-million surplus budget in advance of the May 14 election, Mr. de Jong has abandoned a long-standing commitment to driving economic growth through tax cuts to business and high income earners.

Staff at Independent Newspapers will have their pension benefit almost halved under management proposals to address a €155 million funding shortfall, the Irish Times reported. The plan is part of a dramatic ongoing restructuring of the business over recent months. Management say its success depends on workers realising the “weakness of their legal position” and a possible alternative scenario that could see the “failure” of the group.

Sherry Sheng, a 29-year-old Shanghai policewoman, bought herself a 4,000 yuan ($642) black fur jacket, splurging for the last time before she starts paying off the mortgage on her first home. Sheng is part of a generation of middle class that Chinese media has dubbed “fang nu,” or housing slaves, a reference to the lifetime of work needed to pay off their debts, Bloomberg reported. They’re taking on mortgages even as the government maintains property curbs to damp prices that have almost tripled since China embarked in 1998 on a drive to increase private home ownership.

A judge in Rome has ordered trial for seven former officials in the bankruptcy of Alitalia several years ago when it was still a state-run airline, the Associated Press reported. The present Alitalia began flying in 2009 as a new company owned by a group of Italian investors. The airline's 62 years as a state-run company ended in bankruptcy in 2008. Consumer advocate group Codacons said Tuesday's indictments will allow shareholders of the old Alitalia to seek damages as part of the trial set to begin on June 18.