Headlines

Germany's banking executives can breathe a sigh of relief. Though the government is planning to introduce a banking levy to protect taxpayers from future bailouts, bank contributions will not be exorbitant. Still, some worry the fund might not be big enough to weather the next crisis, Spiegel Online reported. The members of Germany's coalition parties are extremely proud of their decision: The country's approximately 2,000 banks will "not be allowed to gamble with taxpayers' money in the future" declared Volker Kauder, floor leader for the conservative Christian Democrats (CDU), on Monday.

Euro-zone leaders on Tuesday were working on a deal that could secure German backing for a financial rescue plan for Greece in return for an agreement by other countries to let the International Monetary Fund play a substantial role, according to senior European officials, The Wall Street Journal reported. But Germany, which has been pushing for IMF involvement in any bailout, is demanding tough conditions: Chancellor Angela Merkel insists that aid could come only to prevent a Greek default.

German chancellor Angela Merkel’s hard-line stance on Greece has come under attack from a top European Central Bank policymaker, who warned that the cost of inaction could be far worse than offering temporary financial support, the Financial Times reported. The unusually-strong criticism by Lorenzo Bini Smaghi, an ECB executive board member, highlighted frustration in Frankfurt at Berlin’s intransigence, which is threatening a showdown among eurozone political leaders at their summit in Brussels starting on Thursday.

Hellenic Postbank SA, a state- controlled Greek lender, bought credit-default swaps on the nation’s bonds to guard against losses on the debt and help tame speculative pressure, the bank’s former chairman said, BusinessWeek reported on a Bloomberg story. Swaps weren’t bought as a bet on a possible default by Greece, Angelos Philippides told Skai radio today. Hellenic made a profit of about 35 million euros ($47 million) when the bank closed its position, Kathimerini newspaper reported on March 21.

Dubai World may ask creditors for five to eight years to repay its $22 billion in debt as part of a restructuring proposal that could come as early as this week, people close to the matter say, Dow Jones Daily Bankruptcy Review reported. The Emirates conglomerate and its creditors also are weighing a structure that would give creditors a share of the proceeds from asset sales or possibly a share in future profit of the company if it cannot fully meet its interest-payment obligations, one of these people said.

Canwest Global Communications Corp. is using “gamesmanship” to keep Goldman Sachs Group Inc. out of the bankruptcy restructuring, the investment bank said, BusinessWeek reported. Canwest asked the Court of Appeal for Ontario on March 17 to speed up its usual process in hearing Goldman’s request to annul Canwest’s sale to Shaw Communications Inc. Canwest didn’t notify Goldman of its plan until March 19, Gerald Cardinale, managing director of Goldman, said in a court filing.

Saskatchewan's largest hog producer is no longer under creditor protection. Big Sky Farms operated under the Companies Creditors Arrangment Act (CCAA) for just over four months, Saskatoonhomepage.ca reported. The company filed for creditor protection on November 10. It cited a series of problems including three years of low hog prices, a stronger Canadian dollar, U.S. trade barriers and fallout from H1N1, which many people mistakenly referred to as the swine flu virus. More than 98 per cent of unsecured creditors voted in favor of a financial restructuring plan on February 11.

The mayor and city treasurer of the western Negev city of Sderot say their town is tottering on the brink of bankruptcy, Haaretz.com reported. Treasurer Shimon Peretz says that the cumulative deficit of the municipality stands at NIS 28 million. Mayor David Buskila and Peretz claim that the deficit is the result of the cessation in the flow of charitable donations to the municipality, which ceased with the flow of thousands of Qassam rockets which rained down from nearby Gaza for years.

Germany has set out three fundamental preconditions for any rescue package for Greece, including involvement of the International Monetary Fund, and a commitment by its European Union partners to tough new rules to control public debt and deficits in the eurozone – including necessary EU treaty changes, the Financial Times reported. A senior government official in Berlin said there would be no agreement at this week’s EU summit on a specific rescue package for the debt-strapped Greek government.

Greek Finance Minister George Papaconstantinou said Tuesday that Greece has no need for financial assistance and insisted that the country will fix its fiscal problems on its own, The Wall Street Journal reported. But Mr. Papaconstantinou said Greece's European partners should move ahead with some kind of support mechanism to help ensure stability in the euro zone, which is expected to be at the center of discussions at this week's European Union Summit. "Let me be clear, Greece has not asked for financial aid from anyone.