Headlines

Greece capitulated to market pressure on Thursday and took an important step towards a bail-out from its eurozone partners and the International Monetary Fund as it formally sought “consultations” over a €30 billion-plus ($40 billion, £26 billion) loan package to stave off default, the Financial Times reported. In a letter to the European Commission, Greece’s finance minister, George Papaconstantinou, said Athens wanted to discuss “a multi-year economic policy programme with the Commission, the European Central Bank and the International Monetary Fund”.

European Union finance ministers meet in Madrid today to discuss how to curb swelling budget deficits as Greece moved closer to asking for emergency aid to finance the region’s biggest shortfall, Bloomberg reported. Greek Prime Minister George Papandreou yesterday asked for a meeting with the EU, the International Monetary Fund and the European Central Bank, which agreed last week to back a 45 billion-euro ($61 billion) rescue package for the cash-strapped nation. Talks will begin in Athens on April 19.

Dubai World offered creditors a 1 percent interest rate on two new tranches of debt as part of its restructuring plan, but they rejected it as too low, two sources close to the discussions told Reuters. Dubai put the restructuring plan to creditors last month, having asked for a delay in repayment of the state-owned conglomerate's debt in November, and said the deal was conditional upon agreement with the creditors. The proposal would give bank creditors new debt covering the $14.2 billion they are owed over five to eight years, and repay in full property unit Nakheel's 2010 and 2011 bonds.

Niche publisher Palamedia, which was formerly part owned by Seven Network star David Koch, has been placed in voluntary administration after losing a long battle for survival. The company, which publishes trade industry directories, magazines for corporate clients and the financial services industry trade magazine Insto, has not turned a profit since 2005-06 and has been attempting to restructure its business, including examining the option of exiting the publishing sector completely, SmartCompany.com.au reported.

Bone Group, one of the UK's largest steel contractors, has gone into receivership with the loss of 113 jobs, The Scotsman reported. The Wishaw-based group has been hit by a significant drop in demand for structural steel resulting from the downturn in the construction sector.

The European administrator of Lehman Brothers Holdings Inc. Thursday said it has gained control of $48.6 billion of securities and cash and returned $14.3 billion of assets to clients in the 18 months since the U.S. investment bank collapsed, Dow Jones Daily Bankruptcy Review reported. In its six-monthly progress report to creditors, PricewaterhouseCoopers Thursday disclosed that the administrator's costs over the last six months were GBP57.6 million.

The Quinn Group today withdrew its objection to the appointment of permanent administrators of its insurance division, Finfacts reported. On March 30th, provisional administrators were appointed to take control of Quinn Insurance, which has 1.3m customers, including those who transferred from the health insurance business of the Irish unit of UK company BUPA in late 2007. The Financial Regulator had claimed that Quinn was in serious breach of regulatory rules, by providing guarantees for borrowing by other units of the Quinn Group.

Japan, at the moment, looks like it is falling apart, Forbes reported in a commentary. Analysts, for instance, are questioning whether Tokyo will be able to finance its debt this year. Some are even thinking the world's second-largest economy could go bankrupt by 2011. The best scenario, in the opinion of other observers, is that the country can postpone a sovereign debt crisis for three or four years. And here's a new phrase you may hear soon: "sovereign 'Chapter 11.'" Japan has the weakest finances in the industrialized world.

A senior European Union official backed a new crisis fund to help euro-zone members out of debt troubles like those now being faced by Greece and warned that Portugal, sometimes seen by financial analysts as the next European debt "domino" to fall, might need to impose more government austerity this year. The Wall Street Journal reported.

Greek bonds show the nation may have to tap a €45 billion ($61 billion) international bailout to convince investors it can avoid a default, Bloomberg reported. The 10-year securities fell for a third day today, and the yield premium investors demand to hold them instead of benchmark German bunds rose above 400 basis points for the first time since euro-region finance ministers announced the aid plan last weekend. The parliaments of Germany, France and Ireland must vote on whether to contribute their share of the loans, government spokesmen said yesterday.