Headlines

The National Asset Management Agency (Nama) set aside almost €1.5 billion last year to cover further write-downs on €71 billion of loans it had acquired from five banks, according to its annual report published today, the Irish Times reported. The agency made an operating profit of €305 million for the year, but impairment losses were €1.485 billion for the 12-month period. In the first quarter of 2011, Nama made an operating profit of €91 million.

Britain's Supreme Court Wednesday dismissed an appeal by units of Lehman Brothers Holdings Inc. and Bank of New York Mellon, a win for investors in a high-stakes legal dispute involving complex derivatives transactions that has divided courts on both sides of the Atlantic, Dow Jones Daily Bankruptcy Review reported. The U.K.'s Supreme Court, the nation's highest, unanimously ruled in favor of investors represented by Australia's Belmont Park Investments PTY Ltd.

Superquinn’s proposed sale to Musgrave Group is set to proceed after a petition seeking to have the company put in examinership was withdrawn, the Irish Times reported. This morning, the High Court was informed the application by Superquinn for examinership was being withdrawn as a result of Musgrave, which intends to acquire the chain, announcing a €10 million fund is to be established to reimburse certain creditors of the company. The scheme is dependant on the sale of Superquinn to fellow retailers Musgrave going ahead.

Swedish car maker Saab Automobile AB must pay its workers within 14 days to avoid bankruptcy, the general counsel at labor union Unionen said Wednesday after the cash-starved company failed to pay employees on time. The union, which represents 1,000 of Saab Automobile's approximately 1,600 white-collar employees, has started gathering members' pay slips that haven't been honored to prepare requests for payment that will be sent to Saab Automobile. When Saab Automobile receives the requests, likely sometime next week, it will have seven days to pay the claims.

Britain's recovery appears to have slowed recently and there is a risk the economy could tip back into recession, Bank of England policymaker David Miles said on Wednesday, Reuters reported. In a speech focussed on the impact of tighter bank regulation, Miles challenged the conventional notion that higher capital requirements would necessarily stifle growth, and he argued that the cost of deleveraging was much smaller than some have feared.

Sober warnings that the European debt crisis didn't end with last week's summit of European Union leaders reignited concerns of contagion risks on Wednesday, boosting borrowing costs for high-debt governments and pressuring the euro, The Wall Street Journal reported. German Finance Minister Wolfgang Schäuble said Wednesday in an open letter to lawmakers belonging to his Christian Democratic Party that the euro-zone debt crisis isn't over and that more discipline is needed.

Danish banks will have to pay out higher returns on their debt to attract international investors as Europe’s toughest insolvency laws increase funding costs and hurt profitability, a Moody’s Investors Service executive said, Bloomberg reported.

Spain and Italy paid a high price to sell short-term debt on Tuesday, compounding investors' concern that last week's bailout package for Greece left the euro zone's debt crisis unresolved, Reuters reported. Spain's short-term cost of borrowing hit three-year highs and demand fell at its Treasury bills auction while yields at a sale of six-month Italian paper hit their highest since November 2008.

It’s largely an issue of accounting, but we anticipate that Greek debt could end up higher at the end of 2011 than previously forecast–even if the entire debt-reducing discount bond-buyback program and most of the discount bond-exchange program happen this year, The Wall Street Journal Brussels Beat blog reported. Why’s that? The problem is the bond exchange. As we’ve previously laid out, the bond exchange will swap €135 billion of old Greek debt for €121.5 billion in new debt, cutting the total debt stock by €13.5 billion. Eventually.

A €10 million fund is to be established to reimburse certain creditors of Superquinn, the supermarket chain which went into receivership last week, the Irish Times reported. The joint receivers of the company are expected to announce details of the scheme today. Only suppliers who are not covered by credit insurance will be covered by it. The scheme will be funded by Musgrave and indirectly through the banks, using money generated during the course of the receivership, and is contingent upon Musgrave’s purchase of Superquinn.