Headlines

The Development Bank of Japan (DBJ) has agreed to increase the amount of its unsecured loans to Japan Airlines, which is under threat of bankruptcy, from 100 billion yen ($1.08 billion) currently, Japanese media reported on Thursday. Executives of the state-owned DBJ, Transport Minister Seiji Maehara and National Strategy Minister Naoto Kan met on Thursday to agree to raise the amount of loans as JAL has already used 55 billion yen of a 100 billion yen credit line recently extended by DBJ, Jiji news agency said.

Several cabinet members of the Japanese government want Japan Airlines Corp to withdraw completely from its international flights business and consolidate it with that of All Nippon Airways Co, the Mainichi Shimbun newspaper reported on Thursday, Reuters reported. The cabinet members met on Wednesday and appeared to have floated the idea in order to improve JAL's financial condition, Mainichi reported, without citing any sources. But Transport Minister Seiji Maehara was opposed to the plan of having only one international flight service airline from Japan, the newspaper said.

Iceland’s parliament approved an amended bill on Wednesday to repay more than $5 billion lost by savers in Britain and the Netherlands when the island’s banks collapsed during the financial crisis, the Financial Times reported. The passage of the legislation, backed by a 33-30 margin by members of parliament, boosts Iceland’s hopes of swift entry to the European Union and of getting its shattered economy back on track.

Troubled startup SpinVox - once a shooting star of the British technology industry - has been bought by an American rival in a deal worth $102 million (£64 million), the Guardian reported. After a difficult year that saw substantial losses and unrest among its investors, it was today confirmed that the company - which converts customers' voicemails into text messages that they can read more easily - has been acquired by US technology firm Nuance.

Unsecured creditors of bankrupt auto-parts supplier Visteon Corp. want to probe the company's claim that its Korean unit, Halla Climate Control Corp, cannot repatriate more cash, Reuters reported. The official committee of unsecured creditors said in a court filing that Visteon's business plan projects a dramatic and substantial cash build-up in its Asia-Pacific region over the next three years but most of that cash remains trapped in the company's Asian affiliates.

Some hedge funds are starting to wager on painful times ahead for Japan, the world's second-largest economy, The Wall Street Journal reported. These investors, including some who made successful bets against risky mortgages and financial companies in recent years, anticipate trouble for Japan's financial system. Their concern: Government borrowing continues to climb while demand for the nation's debt could taper off.

Never before has Europe’s monetary union seemed so fragile, The New York Times reported in an analysis. Day by day, fears are growing that Greece or another weak country may default on its sovereign debt obligations, forcing the richer countries in Europe to ride to the rescue or risk having one or more of its most vulnerable members leave the 16-nation euro zone. Many European economists discount such a fracture as a remote possibility. But that doesn’t mean Europe has safely emerged from crisis.

Youth fashion chain D2 has become the first post-Christmas casualty, collapsing into administration and putting more than 1,000 jobs at risk, the Guardian reported. The retailer, which specialised in brands such as Wrangler, Levis and Kickers, is based in Scotland and had 79 shops, including three in Dublin. Insolvency specialists James Stephen and Dermot Power from BDO Stoy Hayward have been appointed to take control of the business. The D2 website has been taken offline and two Irish stores have closed.

Aiful Corp.'s debt restructuring is a credit event and has triggered an auction of the credit default swaps written on the Japanese consumer credit firm's debt, a committee of dealers and investors ruled Wednesday, The Wall Street Journal reported. The Japan Determination Committee of the International Swaps and Derivatives Association, or ISDA, determined that a "restructuring credit event" had occurred, according to ISDA's Web site.

The recession has pushed living standards in Britain to below the 2005 general election level, a leading thinktank says as it warns that the country faces a "new age of austerity", the Guardian reported. Although many economists think the economy probably returned to growth in the quarter just ending, the deepest recession in decades has punished everyone, according to a report by Oxford Economics. Its findings are the latest to show that Gordon Brown's previous claims to have ended "Tory boom and bust" were wide of the mark.