Headlines

The number of company insolvencies in England and Wales rose sharply in the early months of 2011, while individual insolvencies continued to decline, Dow Jones Daily Bankruptcy Review reported. The government's Insolvency Service said Friday that there were 4,121 compulsory liquidations of businesses during the first quarter, an increase of 3.7% from the fourth quarter of 2010, and of 2.1% from the first quarter of 2010.

Portugal's financial bailout will be tough for the country's banks, but they should be able to raise their capital ratios without tapping the aid, the heads of the main Portuguese banks said Friday, The Wall Street Journal reported. "We expect to raise our ratio through our shareholders, markets and portfolio sales," Banco Comercial Portugues SA President Carlos Santos Ferreira said in a televised event, adding that fire sales won't happen. The heads of Banco Espirito Santo SA's and Banco BPI SA echoed the comments.

The €25 million being offered by an investor as part of the rescue plan for housebuilders McInerney was well below the potential value of the company’s assets, counsel for three banks objecting to the plan has told the Supreme Court, the Irish Times reported. Senior counsel Michael Collins, for KBC, Anglo Irish Bank and Bank of Ireland, who are owed €113 million by McInerney, said the banks and other parties agreed the best way to realise and manage the assets was to develop the lands that the company owned.

An interim examiner has been appointed to the Xtra-Vision chain of home entertainment stores, InsolvencyJournal.ie reported. Xtra-Vision has 1,300 employees and more than 180 stores across the country. It is understood these stores will continue to trade as normal throughout the examinership process. David Hughes of Ernst & Young was appointed interim examiner. The main reason Xtra-Vision applied to the courts for protection is believed to be due to the fact that two credit insurance providers made the decision to withdraw their coverage to a number of Xtra-Vision suppliers.

Saab's new partner Hawtai defended itself against claims reportedly made by a top Swedish diplomat that raised doubts about the Chinese automaker's ability to salvage the Swedish car brand, Agence France-Presse reported. In a deal unveiled on Tuesday, Hawtai is set to inject 150 million euros ($223 million) into cash-strapped Saab through a partnership including joint ventures in manufacturing, technology and distribution.

Aer Lingus has warned that its controversial €97 million cost-containment programme at the airline may not be sufficient to protect profitability and that more cuts could be needed, the Irish Times reported. In a statement yesterday, the airline signalled that additional measures could be required given the weakness in domestic demand and rising fuel prices. Aer Lingus made an operating loss of €53.7 million in the first three months of this year. This was 41 per cent ahead of the same period in 2010. The airline said its operating profit would be “significantly lower” than in 2010.

The court-appointed administrator of failed consumer lender Takefuji Corp. said Friday he won't disclose details of the bidding process to particular bondholders due to confidentiality agreements, Dow Jones Daily Bankruptcy Review reported. Eiichi Obata, the lawyer charged with Takefuji's sale, said at a press conference he hopes bondholders would understand that the bidding process had proceeded under the guidance of the court and third party inspectors. He added that he would talk with creditors seeking their understanding.

Investors in failed lender Strategic Finance are facing a smaller return with the receiver cutting 9 cents in the dollar from the top end of the prospective recovery range, The New Zealand Herald reported. Receiver John Fisk, of PricewaterhouseCoopers, expects a return of between 12 per cent and 26 per cent of the principal owed to debenture holders, down from the 12 per cent to 35 per cent range previously flagged, according to a letter to investors on April 29.

One of the pillars upon which the euro was established was the principle of “no bail-out”. When the sovereign debt crisis hit the eurozone this principle was ditched, the Financial Times reported in a commentary. As Greece, Ireland and Portugal were unable to service their unsustainable levels of debt, a mechanism was instituted to supply them with the financing necessary to service their obligations. This financing was provided, supposedly, in exchange for their implementing measures that would make their, now higher, debt burdens sustainable in the future.

The number of British retailers falling into administration jumped 30 percent to 60 in the first three months of this year, the highest number for two years, and more could be on the way, a report said on Thursday, Reuters reported. The gloomy assessment from business advisory firm Deloitte came just hours after British home improvements chain Focus DIY said it was on the verge of appointing administrators, in what would be one of the biggest casualties in the retail sector since the demise of Woolworths in 2009.