Headlines

One of Melbourne's oldest colleges, specialising in cookery and hairdressing courses for international students, has run into financial trouble, with an outstanding debt of about $7 million. Hales Institute in Swanston Street had been in financial strife for several months before it was placed in voluntary administration yesterday. Students told The Age the college had recently been demanding tuition fees be paid in advance of the due date. Administrator Craig Crosbie of PPB said the college's financial systems were ''antiquated and clumsy''.

Strong results in a Hong Kong government land auction are the latest sign that the city's real-estate market is surging higher after a brief lull, as government officials here and elsewhere in the region grapple with how to cool off overheating property prices, The Wall Street Journal reported. On Monday, blue-chip developer Sun Hung Kai Properties Ltd. agreed to pay 3.37 billion Hong Kong dollars (US$434 million) bid for a 130,000-square-foot site in the suburbs of Hong Kong.

Thousands of victims of the Storm Financial collapse -- many duped into taking out margin loans they couldn't afford -- will recoup more than $200 million from the Commonwealth Bank in the first major recovery of funds lost by investors during the financial crisis, The Australian reported. In an unprecedented settlement, the bank will refund investors in cases where it has been found the bank lent them money "imprudently" by inflating the value of their homes or by overstating their ability to make loan repayments.

The number of those who worked less than 3.5 hours per day on average reached 963,000 last year, accounting for a record high of 4.1 percent of all Korean workers, The Korea Times reported. Statistics Korea reported Tuesday that since the Asian financial crisis in the late 1990s, the number of part-time workers has been on the rise, jumping from 1.6 percent in 1997 to 2.4 percent in 1998, to 2.9 percent in 2001 and to 3.3 percent in 2004. People working 18 to 25 hours a week numbered 1.13 million last year, more than doubling from 558,000 in 1997.

A standoff between Greece and its euro-zone partners over the timing and terms of a potential rescue is nearing a crucial juncture as the cash-strapped country faces a key test of investor willingness to keep funding its ballooning deficit, The Wall Street Journal reported. The haggling over possible European aid for Greece has become a game of chicken between Athens and the core economies of the euro zone, led by Germany and France.

As speculators attack the euro, Europe is facing a growing threat of national bankruptcies, Spiegel Online reported. The consequences would be dramatic for the whole of the continent, especially German banks, which are highly exposed to risky debt. EU politicians are willing to pay almost any price to help the beleaguered countries. There has never been this much uncertainty.

The International Monetary Fund has long preached the virtues of keeping inflation low and allowing money to flow freely across international boundaries. But two recent research papers by economists at the fund have questioned the soundness of that advice, arguing that slightly higher inflation and restrictions on capital flows can sometimes help buffer countries from financial turmoil, The New York Times reported.

Dubai World will present its banks with a restructuring proposal for its $22 billion (£13.5 billion) debts by the end of next month, The Times reported. An insider close to the Dubai Government said that the struggling state-owned conglomerate will finalise a complete valuation of the group’s assets by the end of February and will have a restructuring offer on the table within the following four weeks. “We are figuring out the best way to use the cash and assets to get the best result for all constituents,” the source said.

Concerns that Greece and other struggling European nations may not be able to repay their debts are focusing investor attention on another big worry: Economies across the Continent have used complex financial transactions—sometimes in secret—to hide the true size of their debts and deficits, The Wall Street Journal reported. Investors long turned a blind eye to European governments' aggressive bookkeeping, aimed at meeting the euro zone's fiscal ceilings.

The German Economy Ministry is unconvinced about General Motors Co.'s restructuring plan for its European Opel and Vauxhall brands as it "doesn't answer important questions," according to a ministry document seen by Dow Jones Newswires. The document casts fresh doubts on GM's chances of receiving €1.5 billion in German state aid, which is a cornerstone of the U.S. automaker's new turnaround plan for its European operations.