Headlines

Vancouver’s Tree Island Wire Income Fund has received notice of default from its lenders after falling out of debt-covenant compliance because of a planned $18 million inventory writedown, The Toronto Star reported. The maker of a wide variety of wire, nails, fasteners and other construction products said the lenders under facilities arranged by GE Finance have so far not exercised their default rights. Management "is actively seeking to renegotiate the terms of the credit facilities," but there is no assurance an agreement will be reached.

Ukraine's central bank has placed Nadra Bank, the country's seventh-largest, in receivership, the head of the National Bank of Ukraine's policy-making council said on Tuesday, The Guardian reported. Petro Poroshenko's announcement of a bank being put in receivership was the second made by the central bank this week. Bank Kiev, Ukraine's 39th-largest by assets, was placed in receivership on Monday, giving it protection from creditors.

Telecom equipment company Nortel Networks Corp. said Tuesday it has received a bankruptcy protection extension to May 1 from the Ontario Superior Court of Justice, the Associated Press reported. Nortel filed for creditor protection Jan. 14 in Canada and the United States and got an initial 30-day protection period. The Toronto-based company became the first major technology company to take that step in this global downturn. The filing came a day before Nortel was due to make a debt payment of $107 million.

Australian consumers grew more pessimistic in February despite aggressive stimulus measures implemented to stave off recession and arrest rising unemployment, The Wall Street Journal reported. Consumer sentiment in Australia fell 4.6% in February from the prior month, according to an index released Wednesday by Westpac Banking Corp. and the Melbourne Institute. The consumer sentiment index fell to 85.8 points in February in seasonally adjusted terms from 89.9 points in January.

Bank of England Governor Mervyn King said the U.K. is in a “deep recession” that may force policy makers to create money and pump it into the economy after cutting interest rates to a record low, Bloomberg reported. “Further easing in monetary policy may well be required,” said King at a press conference in London after presenting the central bank’s revised quarterly forecasts Wednesday.

EU finance ministers on Tuesday urged coordinated action to tackle the economic crisis, against a backdrop of increasing criticism over French "protectionist" moves in its auto sector, Agence France-Presse reported. With Europe in a growing recession the ministers agreed to work together on ways to deal with their banks' "toxic assets" which are hampering lending. They also looked at the progress of a €200 billion ($260 billion) stimulus package designed to kick start their ailing economies. Overall the cry went out to avoid the temptation of protectionism at all costs.

Ireland’s Ulster Bank has today launched what it terms "a new initiative designed to help potential home buyers onto the property ladder”, Finfacts.com reported. The Ulster Bank Secure Step Mortgage gives customers access to the local housing market with a five-year protection against falling house prices. The Secure Step Mortgage is being launched in conjunction with residential property developers from across Ireland and is available to first-time buyers and customers trading up.

As the worldwide economic crisis continues, DLA Piper has launched a formal layoff consultation that will likely eliminate 140 jobs in its United Kingdom offices, Bankruptcy Law360 reported. "This is a difficult but necessary decision based on our reassessment of resource levels following the continuing deterioration of the market. This prudent action will align our capacity levels with existing client demands," DLA Piper managing partner and joint-CEO Nigel Knowles said in a statement.

Flash memory maker Spansion Japan filed for protection from creditors to give it time to restructure its operations, parent company Spansion said Monday. It's the second major event in a bid for survival on the part of the parent company, Network World reported. Spansion's former president and CEO Bertrand Cambou resigned last week as the company sought a possible sale or merger to raise funds to pay off the interest on debt that has come due.

Spain is to unveil a new law to speed up the administration process for ailing companies and to protect debt-repayment deals struck between banks and firms filing for creditor protection, Expansion reported on Tuesday. The reform of Spain's bankruptcy law would give greater certainty to banks which until now could find refinancing deals signed with companies suspended or overturned by the courts, said the paper, without citing its sources. The financial daily said Spanish Prime Minister Jose Luis Rodriguez Zapatero could announce the law to parliament on Tuesday.