Headlines

Jean-Claude Trichet, the president of the European Central Bank, acknowledged on Monday that growth in the euro zone could be weaker than expected, suggesting that the central bank might be more reluctant to raise interest rates again, the International Herald Tribune reported. But Mr.

The Italian government backtracked on parts of its widely criticized austerity package on Monday, scrapping a tax on high earners and scaling back cuts to local authority funding, The Globe and Mail reported. In a statement after seven hours of talks at Prime Minister Silvio Berlusconi’s home outside Milan, the government said it would also exclude years spent at university and military service from retirement age calculations, delaying retirement for some people.

Wellington property developer Terry Serepisos has had bankruptcy proceedings against him adjourned so he can organise the sell-down of over $230 million worth of property, The National Business Review reported. John Billington, Mr Serepisos' new lawyer, told the Wellington High Court today that his client wants to work with insolvency specialists to sell his property portfolio, which includes about 150 residential properties and six significant commercial properties, all in Wellington.

Swedish auto maker Saab Automobile AB could be forced into bankruptcy over unpaid wages by the end of this week, labor union IF Metall said Monday, Dow Jones Daily Bankruptcy Review reported. Darko Davidovic, a lawyer at IF Metall, told Dow Jones that on Aug. 26 Saab received requests for payment of the union's 1,486 members' wages for August. Read more. (Subscription required.)

BDO Canada Ltd. has acquired KPMG's consumer insolvency practice for an undisclosed price, making it one of the country's largest providers of such bankruptcy and credit counselling services, The Globe and Mail reported on a Canadian Press story. The integrated services — which offer trustees in consumer bankruptcy, proposal administrators and credit counsellors — began operating under the BDO Canada Ltd. name effective last Friday. BDO is the fifth-largest single national accounting and advisory partnership in Canada.

The European economy is set to soften further and there are real concerns that the financial market turmoil will derail the recovery, European Union Commissioner for Economic and Monetary Affairs Olli Rehn said Monday, Dow Jones reported.

A new agency with legal powers to enforce debt restructuring agreements between banks and struggling home owners is being considered by the Government to deal with the rise in distressed mortgages. The Cabinet is awaiting a report from an expert group, which is due by the end of next month, before making any major decisions in this area. However, a high-level Government source told the Irish Times yesterday it would avoid any measures “on such a scale that people feel they can abandon their mortgages”.

France and Germany may effectively run the European Union, but Finland has been demonstrating how even a small country can disrupt their grand designs, the International Herald Tribune reported. By insisting that it receive collateral from Greece in return for aid, Finland is threatening to upend an agreement that euro zone countries, led by France and Germany, made in July to expand the E.U. bailout fund. Finland would contribute less than 2 percent of the guarantees provided to the fund, known as the European Financial Stability Facility.

The British Bankers' Association (BBA) has thrown its weight behind a call from Christine Lagarde, head of the International Monetary Fund, for European banks to be forced to recapitalise to help prevent another financial crisis, The Guardian reported. Fears of a sequel to the 2008 credit crunch are growing because of banks' exposure to weak economies in the eurozone, where countries such as Italy, Spain and Greece are struggling to maintain international investor confidence.

Creditors of Mexican glassmaker Vitro said they will appeal a recent ruling that would let the company vote on its restructuring terms -- putting Vitro itself ahead of other creditors, Reuters reported. A Monterrey-based judge last week ruled that under Mexico's bankruptcy law Vitro qualifies as a creditor because of its $1.9 billion of intercompany debt, giving it an advantage over other creditors when it comes to deciding its $3.4 billion restructuring plan.