Headlines

The German parliament has voted by an overwhelming majority in favour of measures bolster the €440bn eurozone rescue fund, and give it new powers to buy bonds and recapitalise weak banks, in a move that lifted financial markets and boosted the euro, the Financial Times reported. The decision was greeted in Brussels as removing a big potential road block to further action to deal with the debt crisis, although several more eurozone parliaments still need to sign off on the package.

A new front in the euro crisis is opening up: what to do if Greece's second bailout package, worth €109 billion ($147.8 billion) and agreed to in July, isn't enough, The Wall Street Journal reported. That risk is real. But with Greece reaching the limits of austerity, at least in the near-term, there are only two options for filling any shortfall. Either euro-zone governments and the International Monetary Fund must dig deeper into their pockets, or Greece has to unpick its deal with bondholders to secure more debt relief.

The National Asset Management Agency has sold loans associated with the Claridges, Connaught and Berkeley hotels in London, it was confirmed today, the Irish Times reported. The loans, which funded the acquisition of the hotels in 2005, were given to the Maybourne Hotel Group by two Irish banks. Nama acquired the loans at the end of June 2010 from the banks. The Maybourne Hotel Group was headed by Derek Quinlan, who has become a Nama debtor.

Anglo Irish Bank has sold several hundred million euros of its 9 billion euros United Kingdom loan book and will increase its efforts once the sale of its U.S. book is completed, its chairman said on Thursday, Reuters reported. "We are making some progress on the UK book," Alan Dukes told journalists in Dublin. "We are tying up the U.S. book sale now and we will be able to devote more energy to see what we can do with the UK book.

The owner of troubled car maker Saab, on Thursday said it will make a euro32 million ($44 million) gain if a planned sale of its Spyker sports car business to U.S.-based private equity firm North Street Capital goes through, The Associated Press reported. Swedish Automobile warned however that there was no assurance that a deal will be completed and that the conditions may change.

Beleaguered discount retailer Koutons Retail India has secured its bankers' approval for a corporate debt restructuring, or CDR, package, The Economic Times reported. The CDR Cell, constituted by the Reserve Bank, cleared the package on Thursday with majority support of the lenders after nine months of negotiations. It paves the way for a reorganisation of Koutons' unmet financial obligations and prevents the retailer from defaulting on its loans and a possible bankruptcy. The Delhi-based retailer is under a Rs 600 crore debt that carries an average cost of 14%.

Europe took another step Wednesday in its slog toward approval of a broader bailout fund for overly indebted countries, as Finland’s Parliament agreed to contribute its share despite an unresolved dispute over its demand for collateral from Greece, the International Herald Tribune reported. The 103-to-66 vote, with 30 legislators absent, still leaves 7 of the 17 members of the euro zone yet to ratify a bailout fund that, despite expanded resources and power, is considered much too small to fend off further market attacks on Greece and other wounded countries.

The president of the European Commission, José Manuel Barroso, urged the European Union to shed the plodding pace of reform that has left it struggling to contain the sovereign-debt crisis, warning that the bloc risks falling apart if it doesn't quickly come together, The Wall Street Journal reported. "The pace of our joint endeavor cannot be dictated by the slowest," Mr. Barroso said Wednesday in his annual state-of-the-union address.

Arrears among credit union members rose 23 per cent to €813 million in the nine months to June 2011, as borrowers and credit unions alike felt the impact of long-term unemployment and economic austerity, the Irish Times reported. Figures from the Irish League of Credit Unions, which represents 496 credit unions in Ireland, show that some 14 per cent of outstanding loans are more than 10 weeks in arrears. The league’s chief executive, Kieron Brennan, said it would be difficult to predict the pattern of arrears in the year ahead. “It depends where the national economy goes.

Kenyans who were attracted to bank loans by last year’s low interest rates are headed for tough times as the lenders raise the cost of money to protect their margins against inflation and exchange rate turbulence, Business Daily Africa reported. The reality of the high cost of debt has been emerging in the past couple of weeks in which successive lenders have raised interest rates citing increased costs of funds from depositors. The rise in interest rates started last week when I&M Bank increased its base lending rate by 2.25 percentage points to 15.75 per cent.