EU lawmakers reach agreement on bank rescue
rules - (www.euobserver.com) The
bank recovery and resolution directive, which will apply to all 28 EU
countries, sets out the hierarchy of creditors to be 'bailed-in' in the event
of a bank crisis. Shareholders and bondholders would be first in line, with
savers last in the queue, while tapping public money to prevent a bank collapse
would only be done as a last resort. The new rules on bail-in will take effect
from January 2016. Under the agreement, the bail-in rules would apply at least
until 8 percent of a bank's total assets have been wiped out. Welcoming the
deal on Tuesday night (11 December), Gunnar Hökmark, the centre-right MEP
tasked with steering the legislation through Parliament, said that the bail-in
mechanism "sends a clear message that bank shareholders and creditors will
be the ones to bear the losses on rainy days, not taxpayers. "
Thai
crisis deepens as PM's supporters weigh in - (www.reuters.com) Thai
Prime Minister Yingluck Shinawatra's red-shirted supporters said on Wednesday
they were ready to defend her government in the streets from an elite-backed
protest movement seeking to install an unelected "People's Council". The
warning highlights the risks of a crisis centered on the electoral and
legislative power of the Shinawatra family, revered by the rural and urban poor
but reviled by Bangkok's royalist elite as inept and graft-ridden. The turmoil
has veered from violent protests in which five people were killed and more than
300 wounded to occupations of government buildings and, in recent days,
bewildering statements by Suthep Thaugsuban, a veteran politician who quit the
mainstream opposition to lead the protesters.
Ukrainian
Life on Hold as Fight for Europe Grips Kiev - (www.bloomberg.com) For
much of the past three weeks, Sergei Veklenko hasn’t given much thought to his
clients or the 150 employees of his office supply company. Instead, he’s been
out on the frozen streets of Kiev -- protesting to help bring about what he
sees as a better future for Ukraine. “Of course I’m sacrificing some of my
business interests by being here,” he said at Kiev’s City Hall, where
demonstrators sheltered as the temperature hit an overnight low of minus 12
degrees Celsius (10 Fahrenheit). “But any investment is a risk. This is one big
and very powerful investment in the future.” Like Veklenko, thousands of
protesters are skipping work to demand the government’s ouster and steer
Ukraine toward closer ties with the European Union. The continuing protests,
now in their fourth week, spell further trouble for an economy going through
its third recession since
2008, where foreign currency reserves are at a seven-year low.
IBM
Says Economy Remains Discouraging - (www.bloomberg.com) International Business Machines Corp. (IBM), the world’s largest provider of computing
services, continues to face economic challenges as it tries to reignite
declining sales, Senior Vice President Erich Clementi said. Demand for
technology services, IBM’s biggest source of revenue, “depends on what the
economic climate is, and that has not been very encouraging,” Clementi said at
a Bank of Montreal conference in New York yesterday. “Europe has shown signs of recovery. North
America has
been a little more uncertain.” Many businesses remain wary about spending money
on physical assets, such as computer
hardware,
machinery or warehouses. Instead, they’re using software and cloud-computing
services to increase efficiency and reach more customers over the Internet.
While IBM ultimately expects to benefit from that shift to the cloud, the
hardware slump has contributed to six straight quarters of declining revenue.
Iceland jails former
Kaupthing bank bosses - (www.bbc.co.uk) Four
former bosses from the Icelandic bank Kaupthing have been sentenced to between
three and five years in prison. They are the former chief executive, the
chairman of the board, one of the majority owners and the chief executive of
the Luxembourg branch. They were accused of hiding the fact that a Qatari
investor bought a stake in the firm with money lent - illegally - by the bank
itself. Kaupthing collapsed in 2008 under the weight of huge debts. For years,
Kaupthing and other Icelandic banks had aggressively pursued overseas expansion
plans, but when they went into administration, they brought the country's
economy to its knees. Just a few weeks before the collapse, Kaupthing announced
that Sheikh Mohammed Bin Khalifa Bin Hamad al-Thani had bought a 5.1% stake
during the financial crisis in 2008. The move was seen as a confidence boost
for the bank.
In
China, Western Companies Cut Jobs as Growth Ebbs - (online.wsj.com)
Rajan in India Rate Dilemma as CPI Tops 11% Amid Growth Woes - (www.bloomberg.com)
Rajan in India Rate Dilemma as CPI Tops 11% Amid Growth Woes - (www.bloomberg.com)
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