Headlines

The problems facing Greece are just the beginning, Spiegel Online reported. The countries belonging to Europe's common currency zone are drifting further and further apart, and national bankruptcies are a distinct possibility. Brussels is faced with a number of choices, none of them good. Accruing debt is becoming increasingly expensive for other countries in the euro zone as well, among them Portugal and Spain. The southern members of the euro zone are especially being eyed with mistrust.

Greece's government was tackling the thorny issue of pension and wage reform Tuesday, part of its plan to fight a debt crisis that has alarmed global markets, even as strikes were being planned nationwide, The Wall Street Journal reported. Prime Minister George Papandreou's center-left government is accelerating austerity measures meant to calm markets and European Union partners, who have urged Athens to swiftly deal with the crisis. Mr.

The governor of Ireland’s Central Bank, Patrick Honohan, has said the Government will take additional equity stakes in the Irish banks as part of the recapitalisation process, The Irish Times reported. Although he could not “put a number” on the future cost to the State of recapitalising the banking system, Mr Honohan said the overall net cost will be “manageable”.

Jean-Claude Trichet, the European Central Bank president, is returning early from a conference in Australia to take part in a summit meeting of European leaders this week, amid speculation over possible action to ease the debt crisis several countries are facing, The New York Times reported. Mr. Trichet will attend the meeting Thursday of the European Council called by Herman Van Rompuy, the bloc’s first full-time president, an E.C.B. spokesman said Tuesday. He said Mr. Trichet was only invited to the meeting on Monday. The E.C.B.

Unsecured creditors of a financially-troubled Saskatchewan-based hog production company have voted overwhelmingly in favor of a proposal that will see them repaid at least some of the money they're owed, CBC News reported. Big Sky Farms, the province's largest hog producer, sought court protection from creditors in November, citing a downturn in the hog market, U.S. trade barriers and a high Canadian dollar. The company said it was $90 million in debt.

Nortel Networks Corp. and units that filed for creditor protection in Canada have reached a settlement agreement on certain matters regarding former Canadian employees, including the company's Canadian registered pension plans, Dow Jones reported. Under the agreement, the former Canadian technology icon will continue to administer the pension plans until Sept. 30. After that date, the plans will be transitioned to a new administrator appointed by the Superintendent of Financial Services.

Shares of Kumho Industrial Co. will resume trading on the Seoul bourse Tuesday after a one day suspension amid market rumors that the financially embattled company may file for bankruptcy protection, the bourse operator said Monday, the Yonhap News Agency reported. "(Kumho Industrial) has not yet looked into applying for court management," the company said in a regulatory filing. The Korea Exchange called for the construction unit of Kumho Asiana Group to respond to the market speculation by 6:00 p.m. Monday, suspending its share trading before the stock market opened at 9:00 a.m.

Australian firms will find it easier to sell bonds in the U.S. after Prime Minister Kevin Rudd’s government said it would reverse a court decision that ranked shareholders equally with creditors, Australia & New Zealand Banking Group Ltd. said, BusinessWeek reported. Some U.S. private placement investors had put Australian bonds into the “too-hard basket” on concerns that the Sons of Gwalia ruling would lower their ranking in the event of a default, ANZ head of debt capital markets Brad Scott said in a Feb. 5 briefing to investors.

Kumho Asiana Group barely avoided court receivership, after group Honorary Chairman Park Sam-koo and other founding members agreed to offer their stakes in group units as collateral in return for fresh loans, the Korea Development Bank (KDB), the main creditor of the ill-fated group, said Monday, The Korea Times reported. It added that they also agreed to manage the group's units separately.

The collapse of a Pyrmont building company, leaving $27 million in unpaid debts, has left many small businesses facing ruin, The Sydney Morning Herald reported. Austruc Constructions entered voluntary administration last month after declaring itself unable to repay debts owed to more than 150 subcontractors it had engaged on construction projects across the state. The majority of the subcontractors are small family-owned businesses. Many are owed hundreds of thousands of dollars.