Tuesday Papers: Business fears banks will cut lending - money news

Financial Times

* Business leaders voiced concerns that banks could cut back on lending again, as ministers unveiled measures to unlock the economic potential of small and medium-sized enterprises.

* The Financial Stability Board has laid out a blueprint for how the world’s national bank supervisors should deal with “systemically important financial institutions”; in a paper published on Monday, the FSB highlighted as one of the key lessons of the crisis that some regulators did not have “the range of powers needed to impel change”.

* AIG has raised almost $37 billion by selling its Alico life insurance subsidiary and floating its AIA unit in Asia.

* Demand for Anthony Bolton’s new Fidelity China Special Situations fund has been so strong that the board has said it is considering ways to make the shares less expensive; shares in the fund hit a premium of nearly 13% to their net asset value in trading on Monday.

* Ambac, the US bond insurer that once provided triple A guarantees on hundreds of billions of dollars worth of debt, said on Monday it may have to file for bankruptcy this year.

* Shipbuilder China Rongsheng Heavy Industries is planning a public offering in Hong Kong this month that could raise as much as $2.6 billion.

* The eurozone economies of Greece, Portugal and Ireland are likely to avoid sovereign bond defaults because of a strong domestic investor base of local banks and pension funds that will buy their government’s debt even in times of stress, according to Moody’s.

The Guardian

* Maverick city trader, Terry Smith, launches new investment fund, Fundsmith, which will invest in sectors that defy 'obsolescene'; Smith is investing £25 million of his own money into the fund.

* Claridge's owner Paddy McKillen fails in attempt to stop €2.1 billion in loans being acquired by Ireland's National Asset Management Agency.

* Ireland sees bond yields rise to record levels; the yield on Ireland's 10-year bond climbed 0.18 percentage points to 7.19% in early trading.