Headlines

KBC NV is mulling changes to its restructuring plan, but it is too early to give a date for repaying state aid, the Belgian bank said Wednesday, Dow Jones reported. "KBC confirms that, as good business practice and as a reflection of sound management, it is currently pro-actively examining what the added value of certain changes to its strategic plan could be," the bank said in an emailed statement.

The Spanish government Tuesday said it cut its budget deficit in half in the first four months of the year and that efforts to overhaul the country's ailing finances are on track despite slippages from regional authorities, The Wall Street Journal reported. Finance ministry data showed that the central government slashed its January-April deficit by 53% on the year to €2.45 billion, equal to 0.2% of gross domestic product. But the finance ministry also said the country's 17 regions—which collectively control about one third of spending—had a deficit equal to 0.5% of GDP.

China's regulators plan to shift 2-3 trillion yuan (£268-404 billion pounds) of debt off local governments, sources said, reducing the risk of a wave of defaults that would threaten the stability of the world's second-biggest economy, Reuters reported. The plan is the first concrete move by the government to tackle the bad debt in local government financing vehicles. It could boost investor confidence in Chinese banks, which provided many of their loans as part of the massive economic stimulus programme launched by Beijing in late 2008 to counter the global financial crisis.

Moody's Investors Service warned Tuesday that it is placing Japan's sovereign debt ratings under review for a possible downgrade, as measures to reduce a yawning budget deficit are increasingly hamstrung by political infighting and an opposition bent on ousting the current government, The Wall Street Journal reported.

Mexican satellite company Satelites Mexicanos SA de C.V. has emerged from Chapter 11 bankruptcy protection under a restructuring plan that will allow it to launch its new satellite next year, Dow Jones Daily Bankruptcy Review reported. The company, known as Satmex, said its bankruptcy-exit plan took effect on May 26. Satmex, which emerged from an earlier Chapter 11 restructuring in 2006, reached a deal on the plan with most of its noteholders before it sought bankruptcy protection in April.

Insolvencies in the British construction sector surged in the first quarter, rising for the first time in two years and raising fears that government cuts were hitting the sector harder than first feared, Reuters reported. The number of businesses going bankrupt climbed 19 percent to 948 from 796 in the prior quarter as fiscal stimulus for infrastructure projects dried up, according to a report from Wilkins Kennedy. Government plans to scrap public sector building programmes, such as Building Schools for the Future, has fuelled bankruptcies and fears of a prolonged downturn.

Creditors of Rolleston-based bus-maker Design Line were successful in placing the company into liquidation today, The National Business Review reported. Two creditors – Lyasight and ENI Engineering –advertised the liquidation petitions. The company had obtained several delays to allow it time to find purchasers but to no avail. The overall debt is estimated as around $10 million. The company makes buses that are used in many countries. It employs about 500 people.

The family of businessman Seán Quinn have brought Commercial Court proceedings claiming that loans of about €2.34 billion made by Anglo Irish Bank to various Quinn companies and Cypriot-registered companies are unenforceable because they were issued for “an illegal objective of market manipulation” — support of the Anglo share price, the Irish Times reported. The action by Mrs Patricia Quinn and her five children — Aoife, Colette, Brenda, Ciara and Seán Quinn Jnr — arises from events of the past two years that led to the family losing control of companies in the Quinn group.

The European Union is racing to draft a second bailout package for Greece to release vital loans next month and avert the risk of the euro zone country defaulting, EU officials said on Monday, Reuters reported. A total restructuring of Greece's massive debt was not an option, he said, leaving the door open to some tweaking of Greece's debt profile that might involve the private sector, as Sarkozy advocated last week.

It has come to this. A year after rescuing Greece from default, Europe is staring into the abyss. The bailout has proved insufficient. Greece needs more money, and it can’t borrow from private markets, where it faces interest rates as high as 25 percent. But Europe’s governments are reluctant to advance more funds unless other lenders — banks, bondholders — absorb some losses by writing down their debts, The Washington Post reported in a commentary.