Headlines

South Korea isn’t ready to let banks repay money they received from a 20 trillion won ($16 billion) state-backed fund, the nation’s financial regulator said, citing the risk of eroding investor confidence, Bloomberg reported. Repayments may fuel concerns among overseas investors about the banks’ capital ratios, said Rhee Chang Yong, vice chairman of the Financial Services Commission. The fund, backed by the central bank, bought hybrid bonds from lenders in March, bolstering their so-called Tier 1 ratios, he said.

Geneva's public prosecutor said he has launched a criminal investigation into allegations that Banco Santander SA's hedge-fund unit misled investors when it funneled their money into Bernard L. Madoff's Ponzi scheme, The Wall Street Journal reported. The formal investigation was opened following a complaint by Geneva Partners, an independent investment fund that bought financial products from Santander's Geneva-based hedge-fund unit, Optimal Investment Services SA.

Ireland’s Minister for Finance, Brian Lenihan TD, today announced the Government’s agreement to the establishment of a single fully integrated regulatory institution, the Central Bank of Ireland Commission, Finfacts reported. This new structure will replace the current board structure of the Central Bank and the Financial Services Regulatory Authority to achieve the highest performance standards for the new organisation. Substantial additional staff has been promised.

Creditors of bankrupt Lyondell Chemical Co. are seeking court permission to sue billionaire financier Leonard Blavatnik, the company's board of directors and certain banks for allegedly burdening Lyondell with too much debt in a recent merger deal, Bankruptcy Law360 reported. In a motion filed Monday in the U.S.

A plan to tighten financial-market regulation is pitting the U.K., home of Europe's financial center, against other members of the bloc, The Wall Street Journal reported. At a European Union summit starting Thursday, a key issue will be how much power should be handed to regulatory bodies that the EU's executive arm, the European Commission, wants to establish, and who will head them. The U.K.'s resistance to the EU plan comes amid tensions among British officials over financial regulation. In a speech Wednesday, Mervyn King, the head of the Bank of England, warned that the U.K.

Swiss financial regulators said Thursday that they are considering taking on new emergency powers that would allow them to break up very large banks, like UBS and Credit Suisse, in order to wind down troubled business units that are not essential to the functioning of the economy, The New York Times reported.

Super Channel, the upstart movie network that launched two years ago to challenge a geographic monopoly in Canada's pay-television sector, has filed for court protection from its creditors, The Globe and Mail reported. After struggling to build a subscriber base, the channel is expected to announce Thursday that it will restructure under the Companies' Creditors Arrangement Act (CCAA). Allarco is backed by Edmonton's wealthy Allard family, which launched Super Channel in November, 2007, after winning a licence a year earlier to start the service.

One in seven Britons, the most indebted consumers in Europe, won’t be able to get credit from the country’s largest banks by the end of next year, according to Datamonitor Plc, swelling the customer base of subprime lenders such as Provident Financial Plc, Bloomberg reported. The number of borrowers denied credit by traditional lenders will rise to 9 million next year, or 15 percent more than at the end of 2008, said Jonathan MacDonald, a financial services analyst at Datamonitor. The London-based research company warned of excessive U.K. consumer debt in 2004.

Fiat SpA Thursday outlined plans to retool its Italian plants as the car maker seeks to cut costs and expand abroad to better cope with the economic crisis, Dow Jones reported. The Turin-based company, which last week took control of U.S. car maker Chrysler LLC, said it plans to keep the production of cars at its Termini Imerese plant in Sicily only until 2011. Fiat Chief Executive Sergio Marchionne told a meeting with the government and the company's labor unions that the Termini Imerese plant, which employs about 1,700 people, would be retooled from 2012. He didn't elaborate.

Three Japanese companies filed an involuntary bankruptcy petition against trendy cosmetics company Stila Corp in a Delaware court, saying it failed to pay its debts, according to court documents, Reuters reported. The creditors listed in the filings made on Wednesday are cosmetics makers Tokiwa Corporation, JO Cosmetics Co and Nihon Kolmar Co, all based in Japan. Together they list claims for sale of goods totaling $812,448. Stila, which has a cult following for its trendy lipgloss and eyeshadow products, is owned by private equity firm Patriarch Partners. Under U.S.