Headlines

Ecuadorian banks will see their deposit levels fall further if the government fails to resolve a debt default that has severely limited financing, the head of the country's largest private bank said on Tuesday. Pichincha bank CEO Fernando Pozo, who spoke at the Reuters Latin American Investment Summit in Quito, said the country has failed so far to inject liquidity into the economy to help private banks reeling from the global financial crisis. "Bottom line the default has limited international financing for us ... our credit lines have been reduced," Pozo said.

The International Monetary Fund said most Asian economies are facing a weak recovery next year from a sharp contraction this year and should boost spending to help offset struggling global export demand, The Associated Press reported. Asia's collective economic growth will likely slow to 1.3 percent this year from 5.1 percent last year, before expanding 4.3 percent in 2010, the IMF said in a report. Excluding China and India, Asian economies will contract 2.9 percent this year and grow 1.6 percent next year, the fund predicted.

Pinton Estates Plc, a U.K. property company controlled by Leo Noe, was forced into receivership by its creditors after failing to collect enough rent to make bond payments, Bloomberg reported. Deloitte LLP was appointed as the company’s joint receiver and manager by at least 20 percent of Pinton’s bondholders, the required minimum, Nigel Letheren, a spokesman for the bond’s trustee Prudential Assurance Co. Ltd., said by telephone yesterday.

Tough conditions imposed by the Quebec government as part of its $100 million (U.S.) loan guarantee to insolvent AbitibiBowater Inc. are threatening to derail the company's financial restructuring, The Globe and Mail reported. Mr. Justice Clément Gascon of Quebec Superior Court is expected to issue a ruling today on the loan, which the company insists is crucial to its survival as it restructures under the protection of the Companies Creditors' Arrangement Act in Canada and Chapter 11 laws in the United States.

Blue Chip co-founder Mark Bryers is adamant Northern Crest is solvent even though it lost $146 million in the 15 months to last March and its equity has been wiped out, The National Business Review reported. After months of pressure from the Companies Office, followed by an application to liquidate the remaining Blue Chip investment vehicle, Mr Bryers has provided the company’s 2008 financial report to the ASX. Northern Crest is listed on the Australian stock exchange although it has been suspended from trading since 2008.

Porsche SE’s controlling shareholders, the Porsche and Piech families, plan to meet in Salzburg, Austria today to hash out how to combine the sports-car maker with Volkswagen AG and reduce €9 billion ($12 billion) of debt, according to two people familiar with the matter, Bloomberg reported. The proposals under consideration include merging the carmakers and finding an investor to buy a stake in the combined company or selling the Porsche AG automotive unit to Volkswagen in return for cash and shares, said one of the people, who declined to be identified because the talks are private.

Struggling General Motors of Canada Ltd. has finally received about $500 million in short-term loans from the federal and Ontario governments to help keep the company alive, the Toronto Star reported. The auto company and two governments confirmed yesterday they had signed an agreement for the public loans from Export Development Canada, the federal agency that provides such funding.

Fiat SpA, the Italian carmaker that’s seeking to take over General Motors Corp.’s Opel unit, may have an advantage over rival bidder Magna International Inc. by guaranteeing German jobs and the brand’s future, Bloomberg reported. A week after GM started due-diligence talks with suitors, Fiat yesterday submitted its plan to the German government, promising to keep the Opel brand and at least three of the division’s four factories in the country.

Hundreds of unionized employees at AbitibiBowater will likely soon be able to take long-planned early retirements after a Quebec judge ruled illegal the company’s unilateral plan to amend their labour contracts, The Canadian Press reported. Justice Clement Gascon said the insolvent forestry company couldn’t prevent eligible workers from exercising their right to retirement. "None of the arguments (by AbitibiBowater) justify the illegality of the gestures it made," Gascon said Monday in a scathing verbal ruling.

Kentucky-based R.J. Corman Railroad Group has a deal to buy Quebec’s ailing Railpower Technologies, a maker of “clean” locomotives and other products, and then sell back some pieces to a group of Railpower managers, The Journal of Commerce reported. The companies said they have a binding agreement, under which Corman obtains the Canadian firm that is operating under court protection and its U.S.