Saturday Papers: Only seven institutions fail stress tests - other news

Financial Times

* The results of stress tests into Europe's leading financial institutions showed that only seven of 91 banks failed to meet its capital requirements; five of the seven were cajas, Spanish savings banks; Germany’s Hypo Real Estate and Greece’s ATE were the only non-Spanish institutions to fail; some investors have sharply criticised Europe’s stress tests, highlighting the “flawed” methodology used to assess the risk of a collapse in the Greek bond markets.

* The UK economy expanded at its fastest rate in four years in the second quarter, figures from the Office for National Statistics showed; at a preliminary estimate, gross domestic product expanded by 1.1 per cent.

* BP set for deep-water drilling off the coast of Libya within weeks in spite of concerns about the UK group’s environmental and safety record.

* Vodafone agrees to pay £1.2bn tax bill.

* BT suffered a setback when the telecoms regulator said the company should not be allowed to raise its wholesale charges to help remedy its pension fund deficit.

* A US judge rejected a bid by Lord Black to return to Canada to live while released on bail.

* The White House has trimmed its forecast for this year’s budget deficit by $84bn, but warned that the US economy faces “strong headwinds”.

* Ford, which on Friday reported its highest quarterly profit in six years, said it expected to hold a net cash position by the end of next year as operating performance continues to improve; net debt shrank to $5.4bn from $9bn in the second quarter.

* The remarkable upturn in German economic sentiment was confirmed by a surge in business confidence, which reached the highest level in July for three years; the business climate index produced by the Munich-based Ifo institute rose to 106.2, from a level of 101.8 in June.

* Kosovo’s central bank governor was arrested after his house and office were searched as part of EU corruption probes.

* Citigroup, Bank of America and 15 other bailed-out groups overpaid top executives by $1.6bn during the height of the financial crisis, according to a review.