Headlines

Indonesia’s influential Bakrie family is facing another debt crisis after creditors issued a default notice on a $437m loan, triggered by the collapse in the price of London-listed miner Bumi plc shares that had been used to guarantee the loan, the Financial Times reported. People familiar with the transaction say none of the 20 lenders in the syndicate led by Credit Suisse are likely to demand repayment even if the Bakries do not increase their collateral.

Canada will pledge funds to the International Monetary Fund in the event countries outside the euro zone require a bailout, but it is of the view Europe has adequate resources to deal with its debt crisis, Finance Minister Jim Flaherty said Friday, Dow Jones reported. He said Europe should "step up to the plate" and "overwhelm" the issue with its own resources. Canada and the U.S. have declined to commit resources to the IMF "at this time," as the Fund has adequate resources to deal with any imminent requirements.

Treasury Minister Danny Alexander will set out new rules on Monday to push ministries to tighten their grip on spending at a time of deep public cuts aimed at wiping out the country's huge budget deficit within five years, Reuters reported. Under the new rules, government departments will be asked to identify 5 percent of their annual budget to cover unexpected costs - in a bid to discourage them from asking for more money from central government when emergencies arise.

Europe's banks are aggravating the region's economic woes by rapidly adopting tough new rules for capital, raising the risk they will have no money left to lend to companies and support economic recovery, Reuters reported. Bloated with risky loans and bad debts, banks are slashing their assets, but this has so far failed to convince investors, hurting the banks' ability to source the capital they need to lend to credit-starved customers. "The genie is out of the bottle.

Spanish banks may need to set aside more money to cover exposure to a bust property market because they still have to recognise billions of euros in loans to non-viable companies, said a report by Spanish property consultancy RR de Acuna. Spain has ordered its battered banking sector to reinforce balance sheets as a correction in the housing market continues and the central bank forecasts lenders will need some 53.8 billion euros ($70.7 billion) to cushion against bad debt. But Thursday's report said that may not be enough. "Banks are not recognising all of their risk.

Home owners with properties in negative equity are being offered new mortgages that allow them to move home, the Irish Times reported. Bank of Ireland this morning said it would offer negative equity mortgages that would allow customers trade up or down, carrying an amount of negative equity to the mortgage for the new property. The lender joins Ulster Bank in offering such deals. The move has been cautiously welcomed, but experts said there were some considerations that should be taken into account.

The housing market slump in the Netherlands is causing headaches for the country's banks, which were just on their way to recovering from the financial crisis in 2008 and could now face rising losses and tighter funding conditions, The Wall Street Journal reported. The Dutch government is expected to wrap up negotiations this week on more austerity measures to bring its budget deficit in line with European Union requirements in 2013. In addition to tax increases and spending cuts, it will likely take a first step in addressing the huge mortgage debt in the Netherlands.

Barclays said Chief Executive Bob Diamond will tie half of his long-term bonus awards to the U.K. bank's future profitability, as the lender looks to quell shareholder anger over pay ahead of its annual general meeting, The Wall Street Journal reported. Mr. Diamond and Finance Director Chris Lucas will forgo 50% of their deferred bonuses, which are paid out over three years, until the bank's return on equity exceeds its cost of equity, Barclays said.

The National Asset Management Agency (NAMA) postponed doling out billions in cash to the banks in March so the money could be used for an obtuse scheme to avoid making a €3.1bn payment to the former Anglo Irish Bank, it emerged last night, The Independent reported. Details of the "intended" Nama payments were revealed to the Dail by Finance Minister Michael Noonan, who also hinted that the toxic loans agency would make the multi-billion payment to the banks in May. Nama issued more than €30bn worth of 'Nama bonds' to banks when it bought their bad loans over 2010 and 2011.

The Netherlands' ABN Amro Bank NV said Wednesday it won't participate in Greece's debt restructuring, making it one of the few major creditors to back out of the deal, Dow Jones reported. ABN Amro won't participate because it is still unclear why it was put on a list of banks that had to take part in the debt restructuring, a spokesman said. The deadline to participate in the deal was Wednesday. The bank, which holds EUR1.3 billion of corporate bonds that are backed by the Greek government, has argued that the list was inconsistent because peers that hold similar debt weren't put on the list.