Headlines

Italian Prime Minister Mario Monti is stepping up pressure on Sicily to tighten its spending as the government seeks to stave off any prospect that the island, one of Italy's poorest regions, risks insolvency, The Wall Street Journal reported. Sicily must undergo a government-monitored austerity program aimed at restructuring the region's public administration—ranging from local hospitals to schools and waste-collection services—with the aim of cutting costs, Mr. Monti's office said in a statement on Tuesday.

Anglo Irish Bank Corp. had ambitions from the late 1990s to be the largest commercial property lender in Ireland. But the bank was built on foundations of sand, The Wall Street Journal reported. It tapped and in turn helped fuel Ireland's property bubble. Loans to customers that amounted to €13.3 billion ($16.12 billion) in 2002 had ballooned more than five-fold to reach €73.1 billion when the Irish government nationalized the lender in early 2009. Some experts had questioned the lender's business plan, but regulators failed to take any concrete action.

Former chairman and chief executive of Anglo Irish Bank Seán FitzPatrick appeared in court Tuesday in connection with alleged financial irregularities at the bank, the Irish Times reported. The court heard Mr FitzPatrick was arrested by arrangement at Dublin Airport at about 5.35am by gardaí attached to the Office of the Director Corporate Enforcement and taken to the Bridewell Garda station. He is understood to have been returning to Ireland on a flight from the US at the time of his arrest.

Greece is in a "Great Depression" similar to the American one in the 1930s, the country's prime minister Antonis Samaras has told former US president Bill Clinton, the Irish Times reported. Mr Samaras was speaking before a team of Greece's international lenders arrive in Athens to push for further cuts needed for the debt-laden country to qualify for further rescue payments and avoid a chaotic default.

The problems facing Spanish and Italian banks are no longer purely ones of liquidity but of capital, the Financial Times reported. Locked out, in effect, of public debt markets as spiralling sovereign borrowing costs have hit bank bonds and sapped appetite among investors for their debt, financial institutions in Spain and Italy have become increasingly reliant on the European Central Bank for funding. Spanish and Italian lenders accounted for the biggest chunk of the €1tn borrowed from the ECB under its three-year, longer-term refinancing operations in December and February.

Authorities in Ireland arrested and indicted two former executives of Anglo Irish Bank Corp. for allegedly encouraging a huge share-support plan, marking the first charges to be brought in an investigation of the lender that was central to the country's banking crisis, The Wall Street Journal reported.

Yellow Media Inc. proposed handing 82.5 per cent of shares in the company to bondholders and lenders in exchange for writing down $1.8 billion debt to $850 million, TheStar.com reported. Under the plan, which has the support of holders representing 23.7 per cent of senior debt, existing shareholders will get 17.5 per cent of new common shares and warrants, the Montreal-based phone directories publisher said in a statement. The company needs 66.6 per cent approval from senior lenders and bondholders to complete the swap, officials said today on a conference call with analysts and journalists.

Platinum Australia (PLA), the ASX-listed platinum miner with all its operations in SA, has now sought refuge from its creditors in voluntary administration. That means there could be some assets up for grabs for mining companies still in the ring, the Financial Mail reported. One of those is African Rainbow Minerals (ARM), Patrice Motsepe's diversified mining company, which is PLA's partner in the advanced Kalplats exploration project, 330km west of Johannesburg.

It’s fish-in-a-barrel shooting season over at Nortel Networks Corp., with claims traders peppering ex-employees with offers to pay 70 cents, 80 cents or more for their bankruptcy claims, The Wall Street Journal reported on a Daily Bankruptcy Review story. That’s not to imply the liquidated telecommunications company’s discarded workers are easy targets. Nortel, generally speaking, hired bright people.

Concerns that Spain won't be able to meet its funding needs helped to spark a global selloff in financial markets Friday, as the government warned the country's economic contraction would drag into next year, and one of its most indebted regional administrations asked the central government for help refinancing its debt, The Wall Street Journal reported. The market slump underscored fears that Spain's finances are spiraling out of control and could require the country to seek a full rescue from the European Union.