By David Lawder

WASHINGTON (Reuters) – Some G20 creditor countries are reluctant to broaden and extend another year of coronavirus debt service relief to the world’s poorest countries, so a six-month compromise may emerge this week, World Bank President David Malpass said on Monday.

Malpass, speaking to reporters as the World Bank’s and International Monetary Fund’s virtual annual meetings get under way, said G20 debt working groups have not reached agreement on the two institutions’ push for a year-long extension of the G20 Debt Service Suspension Initiative (DSSI).

“I think there may be compromise language that may be a six-month extension (and) that it can be renewed depending on debt sustainability,” Malpass said.

Finance ministers and central bank governors from the G20 major economies are scheduled to meet by videoconference on Wednesday. In May, they launched an initiative to allow poor countries to suspend payments on official bilateral debt owed to G20 creditor countries until the end of 2020, which Malpass said has freed up $5 billion to bolster coronavirus responses so far.

Malpass and IMF Managing Director Kristalina Georgieva have been warning that far more debt relief is needed for poor and middle-income countries, including principal reduction, to avoid a “lost decade” as the pandemic destroys economic activity.

Malpass said the two institutions would propose a joint action plan to reduce the debt stock for poor countries with unsustainable debts.

But he said debtor nations were too “deferential” to creditor countries and needed to more forcefully demand a smaller debt burden. “That dialogue hasn’t been as robust yet as I think is necessary to move this process along.”

A new World Bank debt study published on Monday showed that among countries eligible for the G20 debt relief program, external debt climbed 9.5% in 2019 to $744 billion before the

By Huw Jones

LONDON, Oct 13 (Reuters)Central banks set out to regulate cross-border stablecoins like Facebook’s planned Libra with a common approach on Tuesday, saying more rules may later be needed to ensure stability.

The prospect of a currency-backed stablecoin being used by billions of people on Facebook has galvanised central banks into putting together rules and into considering how they could launch their own digital currency.

Existing national rules do not fully cover stablecoins the Financial Stability Board (FSB) said in a statement, adding that regulators should ensure that global stablecoins are fully accountable, keep data safely, have effective safeguards against cyber attacks and money laundering.

The FSB said it will take “appropriate actions” to ensure implementation of the guidance to avoid regulatory gaps that could undermine financial stability, by adhering to all applicable regulatory standards, addressing risks to financial stability before commencing operation, and adapting to new regulatory requirements as necessary.

The FSB, which groups central banks and financial regulators from the Group of 20 Economies (G20) and put a draft version of its recommendations to public consultation in April, said stablecoins could bring efficiencies to cross-border retail payments, which tend to be slow and expensive.

“A widely adopted stablecoin with a potential reach and use across multiple jurisdictions could become systemically important,” the FSB said in a report to G20 finance ministers.

“Authorities agree on the need to apply supervisory and oversight capabilities and practices under the ‘same business, same risk, same rules’ principle,” it said.

Regulators for bank capital and anti-money laundering will report by December 2021 on whether rule changes are needed. A review of how stablecoins are being regulated will be completed by July 2023, the FSB added.

(Reporting by Huw Jones; Editing by Alexander Smith)

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(Reuters) – Britain and the European Union have agreed to pursue ‘mini-deals’ in areas of mutual interest, such as aviation and road transport, even if trade negotiations for a wider deal break down next week, The Times reported on Saturday.

FILE PHOTO: EU flag are placed on broken glass and British flag in this illustration picture taken

© Reuters/DADO RUVIC
FILE PHOTO: EU flag are placed on broken glass and British flag in this illustration picture taken

European Union chief Brexit negotiator Michel Barnier and Britain’s chief negotiator David Frost have agreed that even if a wider deal proves impossible to reach on Oct. 15, contact will continue, The Times said.

In such an event, the two sides would spend November attempting to put together mini-deals to offset the likely disruption when the transition period ends on Dec. 31, the newspaper said, without citing sources.

British Prime Minister Boris Johnson has set a deadline of the Oct. 15 EU summit for a deal, but the two sides are still haggling over a trade deal that would kick in when informal membership ends on Dec. 31.

(Reporting by Aakriti Bhalla in Bengaluru, Editing by Rosalba O’Brien)

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FILE PHOTO: The headquarters of the Italian payments group Nexi are pictured in Milan, Italy, March 28, 2019. REUTERS/Alessandro Garofalo/File Photo

MILAN (Reuters) – The boards of Italian payment group Nexi NEXII.MI and smaller rival SIA will meet later on Sunday and are expected to agree terms for a long-discussed merger, two sources with knowledge of the deal said.

Nexi and SIA, which is controlled by Italian state lender Cassa Depositi e Prestiti (CDP), have been talking about a merger for more than a year and a half, but differences over pricing and governance have proved a sticking point.

The sources said the accord would be an all share deal, with Nexi getting about 70% of the merged company and SIA some 30%. Private equity funds own around 33% of Nexi and this holding is expected to translate into some 23% of the new concern, while CDP should have some 25% in total.

Full terms of the accord are expected to be released before markets open on Monday.

In recent weeks SIA has reached an agreement to keep UniCredit as a client and to extend the contract, removing a major hurdle in determining the company’s valuation in its talks with Nexi, sources said.

The payment sector has seen a wave of mergers and acquisitions, led by U.S. rivals seeking to build up their share of digital transactions.

French rival Worldline WLN.PA agreed to buy local peer Ingenico in February in a 7.8 billion euro deal that will create the fourth-biggest payments company in the world.

CDP has been looking for a deal with Nexi to create a national champion in the payment market and secure important financial infrastructure, sources said.

Reporting by Elisa Anzolin; Editing by Crispian Balmer and Barbara Lewis

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