Concerns over growing loan losses plagued banks this week as institutions with exposure to Europe's developing economies were told they may have been too slow in recognising possible losses.
Both the International Monetary Fund and the European Bank for Reconstruction and Development warned that banks operating in developing Europe were facing a build-up of non-performing loans.
UniCredit lost 6.4 per cent over the week to €2.36, Raiffeisen fell 6.2 per cent to €43.30 and Erste Group declined 5.2 per cent to €29.04.
The approval of KBC's restructuring plan did little to lift sentiment. The bank, which is active in eastern Europe, shed 2.9 per cent over the week to €32.27 in spite of announcing a plan that preserved the group's core business and ruled out the chance of a cash call.
ING, which had its own restructuring agreement approved this week, fell 7.7 per cent to €9.24, while UBS declined 6.0 per cent to SFr16.08 .
The FTSE Eurofirst 300 retreated 1.6 per cent over the week to 1,002.95 after reaching a fresh year high on Wednesday. The Xetra Dax was 0.4 per cent lower for the week at 5,663.15 while France's CAC 40 fell 2 per cent to 3,729.36.
GERMANY
German stocks fell for a second day, erasing their weekly advance, after European Central Bank President Jean-Claude Trichet said the ECB will gradually withdraw emergency cash.
Deutsche Bank AG declined 2.7% as Chief Executive Officer Josef Ackermann said he can't make a forecast on the profit outlook for banks. Commerzbank AG, Germany's second- largest lender, sank 3.7%. Infineon Technologies AG slid 3.4% as Dell Inc. reported lower-than-estimated earnings.
The benchmark DAX Index fell 0.7% to 5,663.15 in Frankfurt, bringing this week's drop to 0.4%. The measure has climbed 54% from this year's low on March 6 as companies reported better-than-estimated earnings and the country's economy unexpectedly exited recession. The broader HDAX Index lost 0.7% Friday.
The rally since March has left the DAX valued at more than 60 times its companies' earnings, the most expensive level since December 2003, according to weekly data compiled by Bloomberg.
Trichet said Friday the ECB will remove liquidity in order to ensure it doesn't fuel inflation.
"Not all our liquidity measures will be needed to the same extent as in the past," Trichet said at a conference in Frankfurt Friday. "Any non-standard measure whose continuation would pose a threat to the achievement of price stability must be undone promptly and unequivocally."
The crisis in Germany's financial system is far from over and banks will bear the brunt of the fallout next year, Finance Minister Wolfgang Schaeuble said Friday in a speech to the Euro Finance event in Frankfurt.
Deutsche Bank slid 2.7% to 49.06 euros. Ackermann said he cannot yet say what banks' profit outlook will be. Separately, Moody's Investors Service said it may cut Germany's biggest bank's long-term debt and deposit ratings.
Commerzbank dropped 3.7% to 6.56 euros.
Infineon, Europe's second-largest maker of semiconductors, fell 3.4% to 3.11 euros. Dell, the world's third-biggest maker of personal computers, reported third-quarter sales and profit that missed analysts' estimates.
Estavis AG soared 7% to 2.15 euros, rebounding from a two-day decline. The real-estate company said it returned to profit in the first quarter and confirmed its "positive" 2009/10 outlook.
FRANCE
France's CAC 40 Index tumbled 30.86, or 0.8%, to 3,729.36 in Paris, for a 2% drop this week. The SBF 120 Index also fell 0.8% Friday.
Financial shares led declines as European Central Bank President Jean-Claude Trichet said the bank will gradually withdraw the emergency cash it has pumped into the economy in order to ensure it doesn't fuel inflation.
Dexia SA, France's biggest lender to local governments, slid 2.6% to 5.20 euros. Credit Agricole SA, the country's largest bank by branches, lost 2.4% to 14.07 euros. Societe Generale SA, France's second-biggest bank by market value, tumbled 2.7% to 47.43 euros.
Bull, the manufacturer of computer equipment, lost 12 cents, or 3.8%, to 3.05 euros, declining for a third day this week. Oddo Securities cut its recommendation on the stock to "add" from "buy."
Michelin & Cie. sank 1.26 euros, or 2.4%, to 51.81 euros, declining for a fourth day. The tiremaker said revenue is unlikely to increase next year as the global economy remains subdued. While top-line growth "will come," the company remains cautious, Chief Executive Officer Michel Rollier said Friday in an interview in Moscow.
NicOx, a biotechnology company, slid 30 cents, or 3.9%, to 7.34 euros, dropping for a third straight day. Aurel cut its recommendation on the shares to "sell" from "hold."
Orco Property Group jumped 80 cents, or 11%, to 8.23 euros, the biggest gain in six weeks. The company, which is under court protection from creditors, said its net loss narrowed in the third quarter from a year earlier.
BELIGUM
In Brussels the Bel 20 closed out the week at 2,483.46, almost flat at 0.09%.
Monday, the National Bank of Belgium announced that the trade balance showed a deficit of Eur 1 billion in August, down from Eur 0.9 billion surplus in July. A year ago, the trade deficit was Eur 2.1 billion.
Exports dropped 17.2% year-on-year to Eur 15.1 billion in August, while imports fell 20.5% to Eur 16.2 billion.
Belgian natural gas shipping company Exmar said on Wednesday its 100 million Euro ($149.7 million) capital increase would be priced 4.20 Euros per share. The additional capital is intended to strengthen the balance sheet of the company and support further growth, it has said.
Exmar said it would offer 2 new shares for 3 preferential rights, with the subscription period running from Nov. 19 to Dec. 3. Its shares closed at 8.65 Euros on Wednesday.
Belgian property investment group Befimmo reported higher full-year recurring earnings helped by low interest rates and confirmed it would pay a final dividend of 1.04 Euros per share.
The group said in July it would pay that final dividend in addition to the interim sum of 3.36 Euros it has already paid.
Full-year net current profit came in at 76.6 million Euros ($114.7 million), a 22.1% rise from a year earlier.
The rise was also due to lower costs for certain buildings, the company said.
Befimmo's portfolio is focused on offices in Brussels, the majority of them on long-term let to public institutions.
The group secured a 159.6 million Euro capital increase at the end of June, but De Blieck said the group was not under pressure to invest.
THE NETHERLANDS
The AEX in Amsterdam finished Friday at 310.03, down 1.05%.
Thursday, a report by the Netherlands' Central Bureau of Statistics said on an unadjusted basis there were 387,000 unemployed persons in the August to October period, down from 394,000 in the three months ended September. The jobless rate held steady for the third consecutive quarter at 5%. Economists expected the rate to rise to 5.3%.
Seasonally adjusted, the number of unemployed persons totaled 403,000 in the three months ended October, up from 399,000 in the previous three-month period. The statistical office said this was the first time in nearly three years, the number of unemployed exceeded 400,000.
Dutch builder Royal BAM Group's nine-month net profit tumbled by two thirds as its property unit made a loss and margins tightened in its other divisions.
Shares in BAM, the largest Dutch construction group, were down 8.5% at 8.194 Euros at 0917 GMT, underperforming the DJ Stoxx construction and materials index .SXOE, which was down 1.2%.
BAM, which like Dutch peer Heijmans has been hit by the downturn in the real estate market, said it still expected 2009 revenue of 8.3 billion Euros ($12.4 billion).
It said it expected a full-year net profit of at least 100 million Euros, having said in August it expected between 100 million and 120 million Euros.
Pretax margins dropped across its construction, engineering, contracting and public-private partnerships (PPP) divisions on shrinking volumes and intensified competition, while its property unit swung to a loss.
Dutch grocer Royal Ahold plans to cut costs by more than 350 million Euros ($520 million) over three years as it looks to strengthen its hand in tough US and European markets and ward off a potential takeover.
Ahold, which runs Dutch market leader Albert Heijn but makes about 60% of its sales in the United States, said on Wednesday the new cost-cutting programme - which follows a 500 million Euro plan ending this year -- would make savings from its stores, supply chain, overheads and in purchasing.
Some analysts have said that if Ahold, which met forecasts with a 1.5% rise in third-quarter operating profit, does not revive its share price it could attract a bid.
The stock has lagged the DJ Stoxx European retail index by 23% this year, held back by cut-throat competition and falling prices in the US, where its rivals include Wal-Mart Stores Inc and Safeway.
ING published an investment note earlier this month saying Britain's Tesco could be a potential bidder for Ahold, though most analysts see an approach as unlikely.
They think Ahold's best chance of boosting its shares is to use its cash pile, which some put at over 2.5 billion Euros ($3.7 billion), for acquisitions, returning to shareholders, or a combination of the two.
Chief Executive John Rishton told Reuters he would look at all options and felt under no time pressure.
"Am I disappointed that our share price hasn't responded more favourably to the positive results and the work that we've done? Yes. Do I think it will in the longer run? Yes. Am I concerned about a takeover? No. Am I focusing on growth? Absolutely," he said in a telephone interview.
SWITZERLAND
Zurich's SMI ended the session and the week at 6,277.46, down 0.15%.
Swiss National Bank Chairman- designate Philipp Hildebrand said the country may need tighter financial rules than the rest of the world to tackle a domestic industry dominated by UBS AG and Credit Suisse Group AG.
"Given the particular situation in Switzerland, higher- than-average regulatory standards are warranted," he said in a speech in Geneva Thursday. The "exceptional" size of the two biggest Swiss banks means "prudent decision-making" is needed on the regulatory framework.
Hildebrand, who takes over from Jean-Pierre Roth in January, helped start a push earlier this year for officials to debate whether some banks are "too big to fail" and should be broken up to prevent a repeat of the crisis worsened by Lehman Brothers Holdings Inc.'s collapse. The Swiss banking industry is 8.2 times the country's gross domestic product, compared with 4.3 times in the UK and 0.9 times in the US, SNB statistics show.
Hildebrand, who is currently SNB Vice Chairman, said that while regulatory reform should be "internationally coordinated," a global agreed level of regulation might not be sufficient for Switzerland.
"Not all countries are confronted with the same urgency for reform as we are," he said.
Shares in the country's two biggest banks were little changed. UBS stock was at 16.86 Swiss francs at 9:36 a.m. in Zurich and Credit Suisse slipped 0.1% to 55.45 francs.
Hildebrand said in June that there can be "no more taboos" when rewriting financial rules and indicated that officials should be prepared to break up some banks if necessary. He said Thursday that banks' size is the "most important question" for Switzerland.
The debate on how to tackle banks deemed "too big to fail" gathered momentum last month when Bank of England Governor Mervyn King said that such banks could be split to separate riskier activities from more stable businesses such as taking deposits.
Hildebrand demanded contingency plans for some institutions in case of financial distress, echoing similar calls from the leaders of the Group of 20 nations after a summit in September.
"At the forefront of our efforts to mitigate the 'too big to fail' problem must be an internationally agreed and orderly process to allow for the wind down of large, systemically important institutions in the event of a severe crisis," Hildebrand said.
The SNB governing board member reiterated that the amount and quality of banks' capital needs to be increased and that higher liquidity ratios are needed. He also urged policy makers Friday to strengthen their efforts.
"What has been missing is a bold and international political commitment to put in place a framework for the orderly resolution of large cross-border financial institutions," he said.
Tuesday, the Federal Statistical Office said Switzerland's real retail trade turnover declined 1.6% in September from the corresponding month of the previous year. Sales were down 1% in August, following July's 1% increase. Sale of food increased 1.1%, reversing 0.3% fall in August. Meanwhile, clothing and footwear sales declined 8.9%.
In nominal terms, retail turnover recorded an annual fall of 2% in September. For the first nine months of 2009, real turnover rose 0.2% annually and nominal turnover by 0.4%.
Consumer appetite for Swiss watches picked up slightly in October as the pace of decline in exports slowed, adding to signs the beleaguered watch industry may be on the road to recovery.
October exports slipped 23% year-on-year after falling 26% in the previous month, while the value of sales edged up to 1.3 billion Swiss francs ($1.29 billion) in October from 1.1 billion francs in September, the Federation of the Swiss Watch Industry said.
The industry, home to companies like Swatch Group, Rolex and Richemont, has seen exports drop 25.5% so far this year as consumers have stopped treating themselves to pricey accessories.
But there are mounting signs that demand is picking up, with Richemont saying it expects better Christmas sales this year, while LVMH is also predicting a better festive period for its brands, including Tag Heuer and Hublot.
Exports to Hong Kong, the industry's biggest market, slipped 18%, while demand in the United States fell 38%, but more shoppers splashed out on timepieces in Singapore, where exports rose 5.6%.
AUSTRIA
In Vienna, the ATX closed out the trading day at 2,578.61, down 1.02%.
Austrian oilfield equipment maker Schoeller-Bleckmann's (SBOE.VI) net profit in the next two quarters could be lower than that reported in the third quarter, its chief executive told Reuters on Thursday.
"I can't rule out that one quarter or the other could be worse than the third, meaning the fourth quarter and the beginning of 2010," Groehmann said in a telephone interview.
Schoeller-Bleckmann earlier on Thursday reported third-quarter net profit of 1.4 million Euros, a decline of 90% year-on-year as revenue almost halved due to reduced investments by oil producers, its main customers.
Austrian steelmaker Voestalpine swung back to an operating profit in its second fiscal quarter and held onto its outlook, adding that there were signs the global downturn had bottomed out. Although a steep year-on-year decline in sales volumes and price levels hit earnings, the group beat all estimates in a Reuters analyst poll.
"Since the end of the summer, there have been growing signs that the global economy has bottomed out," Voestalpine said, adding it would, however, be premature to interpret this as sustained recovery.
Voestalpine's earnings before interest and tax (EBIT) were 70.4 million Euros ($105 million) in the fiscal second quarter to September, a sixth of what they were a year ago but more than double what analysts had predicted [ID:nLD649872].
Net income was 8.4 million Euros, far above the 30 million Euro loss analysts had been expecting.
The company said it would have "clearly positive" operating earnings in the full year and at least break even on its bottom line.
Voestalpine said all sectors were showing signs of stabilisation compared with the previous quarter.
Steel industry body Eurofer said last month that Europe's steel market will remain subdued even after a likely return to growth in the region's economy during the third quarter.
Monday, the Statistics Austria announced that the consumer price index or CPI rose 0.3% year-on-year in October, faster than the 0.1% growth in the previous month.
On a monthly basis, the CPI increased 0.1% in October, unchanged from the prior month.
Meanwhile, the harmonized index of consumer prices or HICP rose 0.1% year-on-year in October, after a flat reading in the previous month. Month-on-month, the HICP rose 0.1% in October.
Producer prices in Austria dropped 2.4% year-on-year in September, slower than the 2.7% fall in the previous month, Statistics Austria reported on Thursday. Producer prices of intermediate goods decreased 5.4%, while prices in the energy sector fell 9.1%.
On a monthly basis, producer prices increased 0.8% in September, faster than the downwardly revised 0.4% growth in the preceding month
SWEDEN
In Stockholm the OMX finished the day and the week on 951.57, up 0.01%.
Swedish central bank Deputy Governor Lars Nyberg said on Wednesday he did not believe developments in Sweden's housing market posed a problem at least in the short term.
Nyberg said the increase in housing prices and in household debt was not sustainable in the long term but that there was little the Riksbank could do with monetary policy to control the imbalances.
"We need to have a low interest rate for a longer period of time in order to stimulate the growth needed to help Sweden out of the crisis," he said in a speech posted on the central bank's website.
"At present, it is not the time to counteract imbalances by leaning against the wind."
The Riksbank left rates unchanged last month and forecast they would stay at a record low of 0.25% through the autumn of 2010.
Sweden's jobless rate fell to 8.1% in October from 8.3% the previous month, the statistics office (SCB) said on Thursday.
The figure compared with a median forecast for unemployment of 8.4% in a Reuters poll.
The key points of this fall were the total employment, which does not include government job schemes, was 4.458 million people from 4.478 million the previous month. Also, the number of hours worked was down 4.2% year-on-year, calender adjusted.
Wednesday, a survey from the TNS SIFO Prospera showed that Money Market Players´ anticipation of a swift recovery of the Swedish economy, witnessed in the last survey, was further confirmed.
The survey showed that money market players expect the GDP to grow almost twice as much in the year to come. For the first year, participants saw 1.7% growth in the November survey compared to 0.9% seen in the fourth quarter survey. Growth is seen rising to 2.6% in coming two years and 2.6% in three years.
The latest survey showed that participants expect inflation of 1.3% in the coming one year, 2.2% in two years and 2.3% in three years.
Money market players' estimated that the central bank's key interest rate would be 1.1% in 12 months and 2.7% in 24 months. On October 14, the fourth quarter expectations survey had shown the repo rate at 1% in 12 months and 2.4% in 24 months.
The Executive Board of the Riksbank held the repo rate unchanged at a record low of 0.25% in October. The central bank added that the forecast for the repo rate also remains unchanged, and the repo rate is expected to remain at this low level until autumn 2010.
Further, survey participants expects the Swedish krona to strengthen further against Eur and USD. Eighty-six% of the money market players believe that the inflation in the second year from now will stay within the Riksbank's 1%-3 % tolerance band.
TNS SIFO Prospera has been commissioned by Riksbank to undertake a series of surveys, twelve times a year, aiming at mapping expectations of inflation, GDP and future repo rates in Sweden among money market players.
Autoliv, the world's biggest maker of air bags and seat belts, said on Tuesday vehicle production volumes thus far into fourth quarter had held up well.
"We have not seen any deterioration in (vehicle) production volumes. We said during our earnings call in October that we were uncertain about December. So far it looks good," the company's Chief Executive Jan Carlson told Reuters in a telephone interview.
In October, Autoliv predicted a 10% increase in organic sales during the fourth quarter, but said visibility was limited towards the end of the year.
DENMARK
Copenhagen's OMX had a volatile week, ending Friday at 332.58, a deckine of 0.38%.
FLSmidth, a major equipment supplier to the cement and mining industries, Tuesday reported a forecast-beating rise in third-quarter net profit and raised its full-year sales and profit guidance.
The company now sees 2009 revenue between 22 billion and 23 billion Danish kroner ($4.41 billion-$4.61 billion), up from its previous estimate of DKK20 billion to DKK23 billion.
The Danish engineering company said net profit in the three-month period ended September 30 rose 8% to DKK352 million from DKK326 million a year earlier. The earnings beat the average forecast of DKK301 million from a Dow Jones Newswires poll.
FLSmith said revenue in the third quarter fell 10% to DKK5.83 billion from DKK6.49 billion, beating a forecast of DKK5.73 billion. Operating profit dropped 19% to DKK475 million from DKK583 million, slightly above analysts' expectations of DKK470 million.
Investors responded by selling FLSmidth shares. At 1135 GMT, the stock was down 4.6% at DKK294. The shares have gained 70% since the start of 2009, outperforming the 35% gain for the OMX index of the 40 biggest companies.
Danish timber trader Dalhoff Larsen & Horneman said Thursday it would slash 775 jobs and downgraded its forecast for 2009 to a pretax loss of between DKK580m and DKK610m, following poor results in the year so far.
The job cuts will mainly affect the company's operations outside Denmark, primarily the loss-making operations in Congo.
The measures will ensure improvements of the results of some DKK85m annually from 2010, but will entail restructuring costs and consequent write-downs of an additional DKK280m in 2009, which was also the reason for the guidance cut.
For the first three quarters of 2009, DLH turned to a loss before interest and tax of DKK86m, compared with a profit of DKK5m a year earlier.
The group reported a revenue of DKK2.796bn, down by 30% year-on-year. Accumulated costs for the year including depreciation and amortisation came in at DKK512m. A cut in costs of DKK80m, or 14%, stem from staff cuts and other efficiency improvement initiatives.
The after-tax loss for the year to date totals DKK159m compared with a DKK83m loss from continuing operations last year. Cash flow from operations was at DKK280m, representing an improvement of DKK407m on the comparative period of 2008.
Danish banks Thursday said they are seeing strong demand in the first two days of the annual auctions of Danish mortgage covered bonds, with yields tightening as both foreign and domestic investors return for the record $115 billion total sale.
Every year Danish mortgage lenders sell billions worth of highly rated covered bonds to raise money for the refinancing of residential mortgage loans.
This year, the amount needed is at a historical high due to the vast sums of lending taken up by Danish homeowners attracted by very low one-year interest rates. Last year, Danish banks raised some $40 billion less in the auction, or around $75 billion.
The three largest issuers are Realkredit, which hopes to raise a total of $32 billion by Dec. 8, Nykredit, which will begin issuing a total of $33 billion next week, and Nordea, which Dec. 1 will start trying to raise a total of $15 billion before the auction closes Dec. 14.
Covered bonds are an important source of mortgage finance in many continental European countries. Although they are high-quality bonds, secondary market liquidity seized up after the collapse of Lehman Brothers and prices fell, making it harder to sell new bonds. Since then, the European Central Bank has reinvigorated the market in the Euro zone with its Eur60 billion covered bond purchase program. It and other Euro-zone central banks have already bought nearly Eur24 billion of covered bonds since the purchases started in July.
Denmark's mortgage covered bond market is the biggest in Europe in front of Germany and Spain.
FINLAND
Helsinki's OMX rounded off a turbulent week at 6,253.40, a dip of 0.54%.
The Ministry of Justice is looking into the possibility of allowing expatriate Finns to cast votes for Finnish elections via mail - something Finns living abroad have requested for a long time.
Currently, Finns abroad have only two possibilities if they want to vote in Finnish elections; they must either vote in Finland or at a Finnish consulate.
"In some large nations like the United States, Canada and Australia, both options are usually very far away," says Arto Jääskeläinen, a top election official at the Ministry.
It's hoped that the mail-in ballot system will be functional by the 2011 Parliamentary elections.
There are currently more than 220,000 Finns living abroad, and the number is growing continuously. Officials believe that postal ballots will significantly increase voter turnout among expats.
The Organisation for Economic Cooperation and Development (OECD) predicts slight growth for the Finnish economy next year. However on Thursday the organisation downgraded its prediction for this year, estimating that gross domestic product (GDP) will shrink by 6.9%.
Last summer the OECD predicted that the Finnish economy would contract by just 4.7%.
The organisation has lowered its 2010 Finnish growth forecast to 0.4%, whereas in June it projected an upswing of 0.8% next year.
The OECD also warned Finland about its worryingly high levels of unemployment and state debt.
The Eurozone has snapped out of recession sooner than expected but recovery will be slow, with annualised growth of 0.6% in the fourth quarter, the OECD said.
Finland is among the 16 EU member states that use the common currency, but the only one in the Nordic-Baltic region.
The OECD, a Paris-based grouping of 30 of the world's wealthiest nations, also urged governments to start withdrawing stimulus measures from late 2010.
Statistics Finland reported on Tuesday that the producer price index or PPI for manufactured products dropped 8.4% year-on-year in October, slower than the 9.4% fall in the previous month. This marks the eleventh straight month in which producer prices have fallen annually.
The decline in prices was driven by reductions in the prices of metals, chemicals, and oil products, the statistical agency said.
On a monthly basis, producer prices increased 0.1% in October, rebounding from the 0.2% decrease in the previous month.
In October, export prices and import prices dropped by 9.8% and 8.9%, respectively. Month-on-month, export prices were down 0.3%, while import prices rose 0.7%. The statistical agency also said that the wholesale price index declined 8.5% on year in October, slower than the 10.2% decrease in the preceding month. Wholesale prices fell 0.1% compared to the previous month.
The Association of Finnish Work on Thursday quoted a Taylor Nelson Sofres poll as saying that about a quarter of the respondents had reported buying more Finnish products than before.
The lobby added that the recession was not the only reason behind the increase as there had been a broader shift of attitudes in favour of buying Finnish.
But more than half of those polled said they did not have enough information about the impact of buying behaviour on jobs.
NORWAY
Oslo's OBX brought the week to a close on 318.16 - up 0.41%.
Statistics Norway reported on Monday that the trade surplus stood at NOK 27.42 billion in October, up from the NOK 21.52 billion surplus in the previous month. A year ago, a surplus of NOK 39.54 billion was recorded.
Exports dropped 22.8% year-on-year to NOK 64.95 billion in October, while imports slid 15.9% to NOK 37.53 billion. Exports excluding crude oil, natural gas & condensates declined 12.1%.
In the first ten months of the year, exports and imports dropped by 23.2% and 14%, respectively, compared to the same period of the previous year. During the period, the trade surplus amounted to NOK 261.95 billion.
Telenor, the Norwegian mobile operator maker said its new tie-up with Huawei Technologies could pave the way for a relationship worth billions of Dollars down the road, in a watershed for the Chinese company's global ambitions.
Norway's largest financial group, DnB NOR ASA, said Thursday that shareholders approved a 14 billion kroner ($2.5 billion) rights issue to offset losses suffered during the financial crisis.
The group will sell shares at 47.3 kroner ($8.39), a 27% discount to the estimated share price of 64.5 kroner after the issue. Wednesday's closing share price was 68.4 kroner.
Shareholders approved the move at an extraordinary general meeting in Oslo.
DnB NOR, which did not apply for support from Norway's bank relief fund, announced the cash call in September. It said then that "based on the current improved market conditions" the rights issue was "in the best interest of shareholders and customers."
The bank saw net profit drop 21% in the third quarter. The result improved on the second quarter _ when writedowns on DnB NOR's Latvian and Lithuanian operations precipitated a 60% profit tumble. But the bank continued to express "uncertainty" about its exposure in the Baltic countries, which have been severely hit by the economic downturn.
Norwegian aquaculture company Codfarmers ASA saw its pretax loss widen to NOK55m in the third quarter of 2009, from NOK46.2m a year earlier.
In its interim report, released Wednesday evening, Codfarmers also said its operating loss before fair value adjustment of the biomass, expanded to NOK12.5m in July - September 2009 from NOK9.2m in the corresponding period of 2008.
The operating revenue shrank to NOK17.2m from NOK26.4m.
The company wrote down the value of the biomass by NOK25m.
Codfarmers had a total harvest of 514 tonnes of own production and 372 tonnes were harvested and sold for external producers in the reported period.
A total 59% of the volumes were sold on contracts.
Cisco Systems Monday raised its cash bid for Norwegian video-conferencing-equipment maker Tandberg by 11% to 19 billion Norwegian kroner ($3.41 billion) and said the US network equipment supplier said its offer was final.
"The new offer represents the offeror's final price for this transaction," Cisco said, adding that it will withdraw the offer if it doesn't achieve the desired 90% level of acceptances.
Cisco raised its bid to NOK170 a share from NOK153.50 a share, and extended the offer period to Dec. 1.
Tandberg's board of directors unanimously recommended the revised bid, Chairman Jan Opsahl said in a statement. "We believe this is an outstanding offer for our shareholders," Opsahl said.
Cisco said it has received acceptances representing over 40% of Tandberg's shares, including from the largest shareholders, Folketrygdfondet and Oppenheimer Funds.
SPAIN
In Madrid the IBEX ended the session at 11,719.30, down 1.07%.
The Organisation for Economic Co-operation has advised Spain that it should to hold off on measures to cut its budget deficit until the economy is in better shape in 2011.
OECD economists are now slightly more optimistic than in the past about Spain's economy. They said it will likely contract by 3.5% this year and 0.25% in 2010.
Spanish GDP was down 0.3% in the third quarter.
Spain sold 3.3 billion Euros ($4.94 billion) worth of 15-year government bonds on Thursday, drawing solid demand despite rising premiums investors demand to hold non-core Euro zone sovereign debt.
The amount offered was at the upper end of a 2.5-3.5 billion Euros the Spanish Treasury had expected to sell of its 2024, 4.8% coupon debt.
The 10-year Spanish/German government bond yield spread was a touch tighter at 55.2 basis points from 55.6 bps before the auction results.
Wednesday, the National Statistical Institute of Spain said in a final report that the gross domestic product or GDP dropped 0.3% sequentially in the third quarter, unrevised from the preliminary report. In the second quarter, the GDP fell 1.1%.
Year-on-year, the GDP decreased 4% in the third quarter, compared to the 4.2% fall in the previous quarter. A year ago, the GDP was up 0.5%. Thus, the statistical office confirmed its preliminary report of GDP decline in the third quarter.
The European Central Bank would maintain its ultra-loose monetary policy stance for some time, the Spanish central bank governor Miguel Fernández Ordonez told the Financial Times on Monday.
"It is clear that any increase in rates is off the screen," he said in an interview to the newspaper. "The markets do not expect any change before the second half of next year."
Ordonez, who is a member of the ECB's Governing Council, noted that the governing council should plan to remove the emergency measures adopted, once the financial markets normalize. "When the markets are working well, we should take them away because otherwise the markets will never work perfectly, ever. Support should be exceptional," he told FT.
He said Spain is ready for recovery as the rebound in Europe is the best news for the country. Around 70% of Spanish exports go to the Eurozone. While, Germany, France and Italy escaped from recession, Spain remained stuck in recession in the third quarter with its GDP falling 0.3% sequentially.
Regarding consumer prices, the policy maker said, "Deflation in the Euro area would be a disaster." However, if there was no deflation in the Euro area and Spain had a negative inflation differential compared with the rest of the Eurozone, he said, that would be the best thing. "Reducing prices and regaining competitiveness is what we have to do."
Ordonez also expressed plans for a series of mergers among Spain's savings banks known as cajas de ahorros, within months. At least 15 institutions should merge with others, he said. Cajas de ahorros are unlisted credit institutions similar to banks. At the peak of the crisis, these institutions lost their market share, the FT report said.
PORTUGAL
The PSI General in Lisbon completed a busy week at 2,876.15, a decline of 0.09% on the day.
Tuesday, the Statistics Portugal announced that the jobless rate stood at 9.8% in the third quarter, up from a 9.1% recorded in the third quarter. A year earlier, the jobless rate was 7.7%.
During the period, the jobless rate for men increased to 9.1% from 8.7% in the second quarter, while the jobless rate for women rose to 10.6% from 9.5%.
The number of unemployed totaled 547,7 thousand persons in the third quarter, larger than the 507,7 thousand persons in the preceding quarter. A year ago, the number of unemployed was 433,7 thousand persons.
The labour force participation rate stood at 52.3% in the third quarter, down from 52.5% in the second quarter.
The European Commission Thursday said it would begin an in-depth investigation into investment aid the Portuguese government gave to the refining and distribution subsidiary of energy company Galp Energia SGPS.
The aid package of Eur160 million was intended to help the subsidiary, Petrogal, modernize two refineries.
"When the beneficiary of aid for a large regional investment project has large market share, we have to verify that the beneficiary genuinely needs the aid to carry out the investment and that the benefits of the aid outweigh the resulting distortion of competition," European Union competition commissioner Neelie Kroes said in a statement.
Portuguese renewable firm EPD Renewables plans to invest $4 billion in the American wind market over the next three years.
EPDR is the wind energy arm of Energias de Portugal, and has built most of its new wind turbines in the US The company has installed 2.5 GW of wind capacity in the US to date.
In 2008, the US surpassed Germany in terms of installed wind power capacity, and EPDR cited the US government's commitment to supporting renewable energy as one factor behind its decision to continue investing in the US market.
The EPDR investment Dollars will go primarily toward new projects and manufacturing equipment.
ITALY
Italy's benchmark FTSE MIB Index dropped for a fourth day, falling 311.54, or 1.4%, to 22,511.68 in Milan. The gauge fell 3.3% this week.
Ansaldo gained 16 cents, or 1.2%, to 13.65 euros, paring a 3.2% decline Thursday. Finmeccanica SpA's railway technology unit had its price estimate lifted to 14.3 euros from 13.8 euros at UniCredit Markets & Investment Banking. The brokerage kept a "hold" rating.
Banca Popolare di Milano lost 12.5 cents, or 2.3%, to 5.23 euros. Bank stocks were the third-worst performers across Europe. European Central Bank President Jean- Claude Trichet said the bank will gradually withdraw the emergency cash it has pumped into the economy in order to ensure it doesn't fuel inflation.
Edison rose 1 cent, or 1%, to 1.05 euros. A2A SpA (A2A IM), Italy's largest municipal utility, hired Mediobanca SpA (MB IM) and Morgan Stanley to advise on talks with Electricite de France SA over control of Edison, according to two people familiar with the matter.
A2A, which said in a statement that it hasn't given "formal mandates" to investment banks or other advisers, fell 1.6% to 1.29 euros. Mediobanca lost 1.7% to 8.31 euros.
Enel retreated for a second day, losing 7.75 cents, or 1.8%, to 4.19 euros. Italy's biggest utility was rated a "short-term sell" at UBS AG, which also cut its 12-month recommendation on Italy's biggest utility to "neutral" from "buy," saying that "demand destruction, capacity additions and a structural change in the gas market all bring downside to prices and margins."
Eni, Italy's largest oil company, fell 34 cents, or 2%, to 16.85 euros, the lowest in almost seven weeks. Crude oil declined for a second day in New York as the dollar strengthened against the euro, lowering the appeal of commodities as a currency hedge.
Saipem, Europe's largest oil-field services contractor by market value, fell 24 cents, or 1.1%, to 21.86 euros.
Eurofly surged 15% to 17.75 cents. The Italian charter airline said it will merge its operations with Meridiana SpA, according to a stock-exchange statement late Thursday.
Fiat declined 51 cents, or 4.9%, to 10.01 euros, extending losses of 2.6% Thursday. The Italian carmaker was downgraded to "neutral" from "buy" at UBS AG, which lowered its equity value figure for Chrysler Group LLC. The brokerage said that "having checked with Chrysler," it understands "that the $8 billion net debt guidance for year-end 2009 does not include an estimated $5.8 billion of obligations linked to the legacy pension and healthcare and insurance liabilities to salaried workers (outside of United Auto Workers)."
Exor, Fiat's main shareholder, lost 41 cents, or 3%, to 13.06 euros.
Lottomatica sank 72 cents, or 5%, to 13.57 euros, the steepest decline since June 29. Italy's administrative court of the Lazio region annulled the auction of the concession of a scratch and win lottery won by Lottomatica, a company official said by phone Friday.
Lottomatica is awaiting the decision on a possible appeal by Italy's lottery agency AAMS, which awarded the concession, the company said.
Seat Pagine Gialle retreated for a sixth session, losing 1.24 cents, or 7.1%, to 16.25 cents. The publisher of yellow pages said in a statement that it confirmed its 2009 financial targets announced in August with its nine- month results. The company said it has 20% "headroom" for the "debt to Ebitda covenant" ratio, according to the statement.
Sorin fell 3.6 cents, or 2.8%, to 1.23 euros after GE Capital SpA sold an 8% stake in the maker of cardiovascular devices.
STMicroelectronics dropped 24 cents, or 4.2%, to 5.53 euros. Dell Inc., the third-largest maker of personal computers, reported earnings that missed analysts' estimates. The Philadelphia Semiconductor Index retreated for a third day.
GREECE
The Athex in Athens ended the week at 2,405.61, down a massive 3.67% for the day.
Tuesday, the Bank of Greece announced that the current account deficit stood at Eur 1.561 billion in September, narrowing from Eur 2.71 billion deficit recorded a year ago.
Capital transfers showed a deficit of Eur 13.1 million in September, down from Eur 69.8 million surplus in the previous year. At the same time, the financial account surplus totaled Eur 1.12 billion, smaller than the Eur 2.29 billion surplus last year.
The current account and capital transfers deficit narrowed to Eur 1.57 billion in September from Eur 2.64 billion deficit last year.
In the January to September period, the current account shortfall amounted to Eur 18.33 billion, narrowing from Eur 24.54 billion last year.
The cost of protecting Greek government debt against default jumped on Thursday, according to monitor CMA DataVision.
The premium investors demand to hold the 10-year Greek government bond GR1OYT=RR rather than benchmark German Bunds also rose, hitting the highest since July over 168 bps as investors fretted about the country's fiscal health.
The five-year credit default swap (CDS) on Greek government debt climbed to 184 basis points from 172.2 basis points at the New York close on Wednesday, CMA said.
This was still well off the peak of 285.1 bps hit in February during the height of the global economic turmoil, according to CMA.
This means it now costs 184,000 Euros per year to insure an exposure of 10 million Euros of Greek government bonds, up from 172,200 Euros on Wednesday.
Concerns about Greece grew after data last week showed the country's economy in its forth straight contraction in the third quarter.
A shakeout in Greek government bonds over the past week underscores recurring concerns over the country's public finances and its banks.
The European Central Bank has dropped increasingly heavy hints that it intends to start unwinding extraordinary measures supporting the banking system soon -- possibly as early as December -- and return gradually to more normal policies in 2010.
But the health of Europe's banking system in general -- and Greece's banking system in particular -- seems so fragile that even mere hints of tightening are enough to cause minor panic.
The European Commission already has singled out Greece as the worst offender with wide budget deficits, and earlier this month ordered the Greek government to present regular progress on cutting red ink.
Questions about the accuracy of Greece's budget accounts are adding to the concern. The government acknowledged last month that its deficit will hit 12.7% of gross domestic product this year -- the biggest in the Euro zone and twice previous forecasts from just two months ago.
ECB President Jean-Claude Trichet said in an interview published Tuesday by Le Monde newspaper -- and posted on the ECB Web site -- that some countries risked "losing credibility" if they didn't shore up their finances soon.
The National Bank of Greece said Monday that it had felt compelled to advise Greek banks to "show restraint" at the central bank's next tender of 12-month funds, scheduled for Dec. 16.
Gold maintained a grip around its all-time high on Friday while oil prices dipped and base metals eased as commodity markets paused for breath after their recent strong run. 
China is passive on the value of the U.S. Dollar as the level doesn't affect the nation's economy, central bank Governor Zhou Xiaochuan said, rebuffing criticism that the government is devaluing the RMB. 
