Headlines

What do Europe’s bank stress tests need to succeed? The question is critical because many analysts think that they offer an opportunity for the euro zone to move beyond the crisis in which it has been enveloped since the start of the year, The Wall Street Journal Real Time Brussels blog reported in an analysis. In a research note out today, analysts at Morgan Stanley say success requires three components: Transparency. Opening up about the state of banks–”on a country-by-country and bank-by-bank basis”– is more important than making dire economic assumptions.

Italy’s debt, the highest in the euro region last year, remains a “potential time bomb” and the country is at risk of default unless it boosts productivity, Capital Economics said, Bloomberg Businessweek reported. “We think the size of the government’s debts will eventually prompt the markets to turn their sights on Italy,” Capital Markets Managing Director Roger Bootle and chief European economist Jonathan Loynes said in a report today.

Problems with its overseas operations have contributed to forcing Asian restaurant chain Mao into receivership, the Irish Times reported. AIB has appointed Kenneth Fennell of corporate restructuring specialists Kavanagh Fennell as receiver to the company, which operates three restaurants in Dublin. The business is continuing to trade under its existing management and is seeking a buyer or new investor. In recent years, the group opened restaurants in Cape Town in South Africa, which is closed; and in Glasgow, Scotland, which is for sale.

European Union Economic and Monetary Affairs Commissioner Olli Rehn doesn’t rule out the possibility of introducing changes that would allow for an orderly insolvency of a euro-zone member, Handelsblatt reported in an interview. For now though, Rehn is concentrating on reforms that don’t require amendments to the EU’s Lisbon Treaty, the German newspaper cited him as saying. The commissioner isn’t against calls by Germany for tougher action on countries who break the budget rules of monetary union, according to Handelsblatt.

Greece on Thursday sealed a deal with the European Investment Bank for €2 billion ($2.45 billion) in financing to turn around the country's contracting economy, as the ruling Socialist Party implemented tax increases to help slash budget deficits, The Wall Street Journal reported. Greek Finance Minister George Papaconstantinou, Economy Minister Louka Katseli and EIB Vice President Ploutarchos Sakellaris signed the finance agreement as part of a program known as the National Strategic Reference Framework.

Electrical and whitegoods retailer Clive Peeters Ltd, which is in voluntary administration, has agreed to sell stock and plant equipment and other items to Harvey Norman Holdings Ltd for $55 million, The Sydney Morning Herald reported. Harvey Norman said in a statement on Friday that it would purchase certain stock and plant and equipment, as well as "know-how, intellectual property rights and systems" from Clive Peeters. The $55 million purchase was subject to terms and conditions. Clive Peeters entered into voluntary administration on May 19, carrying $160 million of debt.

Greek telecommunications company Wind Hellas Thursday said it has begun a strategic review, which includes the potential sale of the business and the appointment of a chief restructuring officer, as the company's performance continues to suffer in the wake of the Greek government's austerity measures, Dow Jones reported. The news comes just six months after Wind Hellas completed a debt restructuring that stripped away more than €1 billion of its debt.

Chemtura Corp. has struck a deal to sell its stake in a Dutch joint venture that will pay the chemical company $5 million and allow it to unload $14.25 million in environmental and pension liabilities, Dow Jones Daily Bankruptcy Review reported. In papers filed Wednesday with the U.S. Bankruptcy Court in Wilmington, Del., Chemtura said the deal will allow it divest a petroleum-additive business that contributes little to its bottom line but exposes it to potentially expensive obligations. The sale to Sonneborn B.V.

Receivers have moved in to take control of the company that runs one of Auckland's top hotels, the Westin Lighter Quay, The New Zealand Herald reported. The five star hotel will remain operating as normal and staff will not be affected. There is no change to any forward bookings. Receivers KordaMentha have issued a release saying they have been appointed as receivers for Lighter Quay Management - the company which runs the Westin Hotel complex.

Former Irish tycoons Bernard McNamara and Sean Fitzgerald are both facing bankruptcy after private investors mounted a fresh attempt to force McNamara into insolvency, while Fitzgerald’s bid to avoid bankruptcy seems set to fail, IrishCentral reported. McNamara, the Clare-born builder turned property developer, is being pursued by a group of investors seeking up to 40 properties. McNamara, whom the Sunday Times dubbed ‘the man who lost everything’, is being pursued by creditors on two separate fronts, according to Court and media reports.