Business News: The Great Copper Heist

Nov. 25 (Bloomberg) -- Irish banks may need as much as 30 billion euros ($40 billion) of new capital before investors will be persuaded to fund them, according to CreditSights Inc.

Allied Irish Banks Plc and Bank of Ireland, the nation’s biggest lenders, will probably have to boost their so-called core Tier 1 ratio to 15 percent from 8 percent, analyst Simon Adamson wrote in a note today. Allied Irish needs 9.1 billion euros and Bank of Ireland needs 4.5 billion euros, based on CreditSights’ analysis of the banks’ latest financial reports.

“If you really want to put the banks in a position where people are comfortable, a 15 percent core Tier 1 ratio is probably the level you’re going to need,” London-based Adamson said in an interview. “The alternative would be to have a pot of money available if needed, but at that point you might as well just put it in.”

Ireland is in talks with the European Union and the International Monetary Fund on an 85 billion-euro aid package as the authorities seek to avoid the nation’s financial crisis spreading to Portugal and Spain. Ireland’s financial system imploded after banks racked up losses when a decade-long real- estate boom ended.

Anglo Irish Bank Plc, which was nationalized last year, is slated to receive 11.4 billion euros of new capital, though its final needs will depend on what the government decides to do with the lender, Adamson wrote.

Subordinated Losses

The country is likely to resist taking full ownership of Allied Irish and Bank of Ireland. The recapitalization of Allied Irish will bring the government’s stake to “close to 100 percent,” while its 36 percent share in Bank of Ireland is likely to rise to “a significant majority,” Adamson wrote.

The banks’ subordinated debt holders may face losses, according to Adamson.

“It would be no surprise if the European Commission and the IMF tried to impose losses on holders of subordinated debt in the Irish banks,” he said.

The government may copy the template used with Anglo Irish subordinated bonds, where investors exchanged existing notes at a minimum 80 percent discount for government-guaranteed senior debt, according to Adamson’s note.

“There are few hard facts and predicting the outcome for the Irish banks is mainly speculative,” he wrote. Among the more likely outcomes is that “subordinated debt holders could suffer substantial losses in a similarly structured deal to that used for Anglo Irish.”

The government is unlikely to impose losses on senior bondholders, partly because it wants the banks to return to the markets soon, Adamson wrote.

--Editors: Andrew Reierson, Paul Armstrong

To contact the reporter on this story: John Glover in London at johnglover@bloomberg.net

To contact the editor responsible for this story: Paul Armstrong at Parmstrong10@bloomberg.net

Mortgages Draw Record Foreign Demand to Denmark: Credit Markets

Posted: 25 Nov 2010 04:38 AM PST

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By Gelu Sulugiuc and Esteban Duarte

Nov. 25 (Bloomberg) -- Denmark’s $97 billion mortgage-bond auction is poised to attract record demand from international investors as Europe’s sovereign debt crisis boosts appetite for the top-rated securities.

Nykredit Bank A/S, the country’s biggest issuer of the debt, Realkredit Danmark and more of the nation’s banks will offer bonds tied to home loans with maturities of one to five years in auctions starting today. Foreign funds will buy as much as 20 percent of the debt, an all-time high and up from 15 percent last year, according to Danske Bank A/S.

Denmark’s $490 billion mortgage-bond market, the third- largest after the U.S. and Germany, proved resilient during the global financial crisis, with prices rising 6.57 percent in 2008, 7.1 percent in 2009 and 5.4 percent this year, according to the Danske Bank Mortgage Bond-Market Index. The securities provide an alternative to European government bonds roiled by a spreading debt crisis that led to bailouts for Greece and Ireland.

“There might be an incentive for foreign investors to have a higher focus on the Danish market compared to last year because of the turmoil in the European bond market,” said John Madsen, the chief economist at Nykredit in Copenhagen. “The Nordic market, and the Danish market especially, is in a more stable situation.”

Danish banks typically hold three bond auctions each year. In 2009 they accounted for about 25 percent of the country’s mortgage bond market, according to government data. The sale over the next two weeks is the main auction of the year where new securities are issued and rates on existing notes are reset. Smaller auctions in March and September resulted in $18 billion of issuance, according to Nykredit’s Madsen.

Yield Spread

Elsewhere in credit markets, the extra yield investors demand to own company bonds instead of similar maturity government debt was unchanged at 169 basis points, or 1.69 percentage points, according to Bank of America Merrill Lynch’s Global Broad Market Corporate Index. Yields averaged 3.7 percent.

The cost of insuring European bank bonds from default rose for a sixth day on concern investors will be forced to share the cost of bailouts, while Caterpillar Inc. sold 1 billion yuan ($150 million) of debt in the second Hong Kong issue by a U.S. company in the Chinese currency. Gift and accessory retailer Spencer Spirit Holdings Inc. was among borrowers to postpone debt sales.

Financial Swaps

The Markit iTraxx Financial Index of credit-default swaps on subordinated debt of 25 European banks and insurers rose 7.5 basis points to five-month high of 275.5, according to JPMorgan Chase & Co. Concern about the cost of financial-industry rescues also helped push a gauge of government debt risk to the highest ever.

The Markit iTraxx SovX Western Europe Index of contracts on 15 governments rose 3 basis points to a record 184, according to CMA. Spain increased 8 basis points to an all-time high based on closing prices of 303 and Ireland jumped 20 basis points to a record 599.5.

China’s first yuan-denominated credit-default swaps started trading on the interbank bond market as the nation broadens its financial system, according to the National Association of Financial Market Institutional Investors.

Four warrants contracts with a face value of 480 million yuan changed hands yesterday, the bond market regulator said in a notice published on its website.

Credit-default swaps pay the buyer face value in exchange for the underlying securities or the cash equivalent should a company or country fail to adhere to its debt agreements.

Caterpillar Bonds

Caterpillar, the world’s biggest maker of construction equipment, sold 2 percent notes due in December 2012 in Hong Kong through its Caterpillar Financial Services Corp. unit, according to data compiled by Bloomberg. Goldman Sachs Group Inc. managed the sale for the Peoria, Illinois-based company, said a person familiar with the offering who declined to be identified because the marketing was private.

The transaction followed McDonald’s Corp.’s 200 million yuan of three-year notes in September, the first sale in the currency by a foreign company in the former British colony, the data show.

Spencer Spirit, the gift and accessory retailer, pulled its $150 million sale of senior-secured notes due in 2016, according to a person familiar with the transaction who declined to be identified because the marketing was private. At least six other companies in the U.S., most with junk ratings, put off planned debt sales this week as credit markets weakened amid heightened concern about European sovereign debt levels.

Pulled Deals

In Asia, Hongkong Electric Holdings Ltd., rated A+, S&P’s fifth-highest investment-grade, joined junk-rated Yuzhou Properties Co. and Vietnam National Coal-Mineral Industries in withdrawing offerings, people familiar with the transactions said.

Junk bonds are high-risk, high-yield debt rated below Baa3 by Moody’s and less than BBB- by Standard & Poor’s.

Bonds from Fairfield, Connecticut-based General Electric Co. were the most actively traded U.S. corporate securities by dealers, with 47 trades of $1 million or more, according to Trace, the bond-pricing service of the Financial Industry Regulatory Authority.

The S&P/LSTA US Leveraged Loan 100 Index dropped 0.05 cents to 91.8 cents on the dollar, the fourth consecutive daily decline, according to data compiled by Bloomberg. Prices on the index, which tracks the 100 largest dollar-denominated first- lien leveraged loans, fell to the lowest since Nov. 3.

In emerging markets, relative yields fell 10 basis points to 244 basis points, according to JPMorgan index data. It was the biggest drop since Oct. 26.

Danish Mortgage Bonds

Denmark’s mortgage bonds haven’t suffered a default since they were introduced after the great Copenhagen fire of 1795. Mortgage lenders can’t take customer deposits, so they use mortgage bonds to raise money as well as spread the risk of their real-estate loans.

“The Danish mortgage-bond market is the only one that has survived without any scratches through the financial crisis,” said Jens Kristian Kimper, an analyst at RealKredit Danmark, the mortgage-bond unit of Danske Bank and Denmark’s second-biggest provider of the bonds after Nykredit A/S. “Interest from foreign investors is increasing.”

The prices investors pay at the auctions determine the rates lenders can charge. The central bank’s benchmark lending rate is 1.05 percent, compared with 1 percent for the European Central Bank and a range of zero and 0.25 percent for the Federal Reserve.

Prices Rise

Danske Bank’s index of Danish mortgage bonds rose to 124.675 on Nov. 23, approaching the record-high of 125.642 on Oct. 12 and up from 118.3 on Jan. 4. The nation’s mortgage bonds climbed 23 percent since the beginning of 2007, the index shows.

“International investors can’t get anything similar in euro-land,” said Jens Peter Soerensen, chief analyst at Danske Bank in Copenhagen. Danish mortgage bonds also “have great liquidity,” he said.

The rally coincides with the nation’s government bonds, which have returned 10.5 percent this year on average, second only to the 14.8 percent gain for South Africa’s debt among 26 markets tracked by Bloomberg/European Federation of Financial Analysts’ Societies Indexes.

Danish house prices rose 3.3 percent in the third quarter compared with the same period a year earlier, the Copenhagen- based Association of Danish Mortgage Banks said in a statement on its website Oct. 26.

Faster Growth

Denmark’s economy will expand 2 percent this year and 2.3 percent in 2011, compared with 1.7 percent and 1.5 percent growth for the 16 nations that use the euro, the International Monetary Fund said in its World Economic Outlook last month. Since June, the nation’s currency, the krone, has appreciated 8.83 percent.

If the mortgage debt “of well-known names such as Nykredit offers some pick-up versus government bonds still rated AAA it could be interesting for money-market funds,” according to Maud Debreuil-Chevroton, a Paris-based money manager at Axa Investment Managers. “The Danish mortgage bonds may take advantage of the flight-to-quality of major international investors seeking to stay away from European peripheral risk.”

Last year’s record $115 billion mortgage-bond auction drew yields at the lowest level since adjustable interest-rate loans were started 13 years previously, lenders including RealKredit Danmark said. RealKredit Danmark, the nation’s second-biggest mortgage lender, sold one-year notes at an average yield of 1.78 percent and three-year bonds at 2.81 percent, the lowest levels since the securities were introduced. Five-year notes sold at an average 3.34 percent, the least since 2006.

--With assistance from Matthew Brown and Andrew Reierson in London; Boris Korby, Mary Childs, Sharon L. Lynch and Richard Bedard in New York; Katrina Nicholas in Singapore, Henry Sanderson in Beijing and Keith Naughton in Southfield, Michigan. Editors: Tasneem Brogger, Paul Armstrong

To contact the reporters on this story: Gelu Sulugiuc at gsulugiuc@bloomberg.net; Esteban Duarte in Madrid at eduarterubia@bloomberg.net

To contact the editors responsible for this story: Paul Armstrong at Parmstrong10@bloomberg.net; Tasneem Brogger at tbrogger@bloomberg.net

Meister Says German Euro Aid Has Limits, EU States Must Do More

Posted: 25 Nov 2010 04:33 AM PST

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By Rainer Buergin and Brian Parkin

Nov. 25 (Bloomberg) -- Euro-area governments can’t rely on endless German aid to bail them out and instead have to be “more credible” in cutting their budget deficits, a senior member of Chancellor Angela Merkel’s party said.

“The answer can’t be to make things easier” for over- indebted countries, Michael Meister, the parliamentary finance spokesman for Merkel’s Christian Democratic bloc, said yesterday in an interview in Berlin. “The answer must be for them to roll up their sleeves and tackle the problems they’ve identified.”

German experience over the past decade of the euro shows that peripheral countries have failed to use cheaper financing to make their economies more competitive, said Meister, rejecting the idea of joint bond sales by euro members in which Germany would share its benefit of lower borrowing costs.

Meister refused to accept German responsibility for fanning the debt crisis that has driven bond yields in Spain and Portugal to records, underscoring mounting frustration that Germans are being left to pick up the tab for fellow euro-area members. “Must we end up paying for the whole of Europe,” said a headline yesterday in Bild, Germany’s best-selling newspaper.

Lawmakers “expect to hear a word of praise every once in a while for the solidarity given to others instead of getting criticism all the time,” said Meister.

Germany, as Europe’s biggest economy, agreed to contribute as much as 148 billion euros ($197 billion) to the 750 billion- euro rescue fund set up in May to prevent the Greek crisis from spilling over into the wider 16-nation euro area, the largest share of any country. European Central Bank council member Axel Weber said late yesterday that governments can increase the size of the bailout fund if needed.

Patience Running Out

The patience of lawmakers in Merkel’s coalition is “not without limits” and “the willingness to take further decisions” involving German taxpayers’ money “rather small,” Meister said.

There’s a need for “alternative solutions” rather than additional aid measures, said Meister. He backed Merkel’s push for a permanent crisis-resolution mechanism for the euro region from 2013 to shift the burden of bailouts from taxpayers to investors, saying that “no alternatives have been presented.”

Merkel’s stance “hasn’t been helpful,” Irish Prime Minister Brian Cowen said in an interview with the Irish Independent newspaper published Nov. 12, nine days before Ireland sought a bailout package. Spanish Prime Minister Jose Luis Rodriguez Zapatero said the same day that he opposes Merkel’s plan, so “it won’t be easy” for her to get her way at a Dec. 16-17 summit of European Union leaders which is due discuss the step.

‘Bring Clarity’

Germany wants buyers of new euro-region bonds to accept liability clauses starting in 2011, two years before the new crisis mechanism kicks in, a Finance Ministry document shows. Meister said introducing the so-called collective action clauses early may smooth the transition.

“The faster we can bring clarity to markets about the shape of future regulation, the better,” he said. “We can help calm markets down if we start implementing elements of future regulation now.”

The premium on Spanish debt over German bunds rose to a euro-era record yesterday. The extra yield investors demand to hold 10-year Portuguese government bonds instead of benchmark German bunds widened to 429 basis points.

The countries concerned, not Merkel, are to blame for widening spreads, according to Meister.

“The only thing that can be done now is to take credible measures that give a signal to markets,” Meister said. “The countries concerned can only convince markets through clearly- structured, decisive action.”

--With assistance from Christian Vits in Frankfurt and Mark Deen in Paris. Editors: Alan Crawford, Leon Mangasarian

To contact the reporters on this story: Brian Parkin in Berlin at bparkin@bloomberg.net; Rainer Buergin in Berlin at rbuergin1@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

Spanish, Irish Bonds Decline on Trading Costs as Stocks Gain

Posted: 25 Nov 2010 04:28 AM PST

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By Stephen Kirkland

Nov. 25 (Bloomberg) -- Irish and Spanish bonds fell after LCH Clearnet Ltd. increased the cost of trading Ireland’s debt. Stocks gained for a second day in Europe and the dollar strengthened to parity against the Swiss franc.

Spain’s 10-year bond dropped for an eighth day, sending the yield 14 basis points higher at 12:20 p.m. in London. The Irish yield rose for a third day, adding six basis points. The Stoxx Europe 600 Index advanced 0.2 percent after climbing as much as 0.6 percent. Futures on the Standard & Poor’s 500 Index slipped 0.1 percent, with U.S. markets closed for the Thanksgiving holiday. The Swiss franc weakened as much as 0.4 percent to 1.0001 per dollar. Oil gained 0.4 percent to $84.22 a barrel.

LCH demanded for the third time this month that clients place a larger deposit to trade Irish bonds, increasing the margin requirement to 45 percent from 30 percent. Irish Prime Minister Brian Cowen said yesterday a bailout of 85 billion euros ($113 billion) has been discussed with the European Union and the International Monetary Fund.

“Relief in the European bond market on the back of Ireland’s decision to resort to the EU bailout fund has turned out to be short-lived,” Ulrich Wortberg, a fixed-income analyst at Helaba Landesbank Hessen-Thueringen in Frankfurt, wrote in a report today. “Risk premiums are heading higher.”

The extra yield investors demand to hold Irish debt instead of benchmark German bunds rose 10 basis points to 6.28 percent, and the spread on Spanish bonds widened 12 basis points to 2.47 percent. The yield on the Portuguese 10-year bond climbed eight basis points to 7.25 percent, increasing for a third day. The yield on the 10-year Italian security rose four basis points to 4.39 percent after the government’s sale of 8.5 billion euros ($11.3 billion) of six-month Treasury bills.

Capital Shopping

The Stoxx 600 continued its rebound from the biggest decline in four months on Nov. 23. Real-estate companies led the advance, as Capital Shopping Centres Group Plc surged 9.9 percent after saying Simon Property Group Inc. may make a cash offer for the company. Mining stocks rallied, with Xstrata Plc gained 2 percent and Rio Tinto Group climbed 1.5 percent. Bank of Ireland Plc rebounded 6.4 percent after falling to the lowest level since March 2009 yesterday.

Even as Bank of Ireland rallied, the risk of default among the region’s lenders increased for the sixth day. The Markit iTraxx Financial index of credit-default swaps linked to banks’ subordinated debt climbed six basis points to 274, the highest since June 9. The senior index rose 4.5 basis points to 162.

Asian stocks gained for the first time in three days. Toyota Motor Corp., the world’s biggest carmaker, added 1.1 percent. Billabong International Ltd., the world’s biggest maker of surfwear, jumped 1.9 percent in Sydney.

Emerging Markets

The MSCI Emerging Markets Index rose for a second day, adding 0.2 percent. China’s Shanghai Composite Index gained 1.3 percent. The won appreciated 0.4 percent against the dollar, paring a 1.5 percent loss in the past two days following a North Korean artillery attack on Nov. 23. Poland’s zloty weakened 0.5 percent versus the euro after Fitch Ratings said the government needs to narrow its budget deficit to prevent “pressure” on the country’s creditworthiness.

The Swiss franc fell against all 16 of its most-traded peers, depreciating 0.4 percent to 1.3339 per euro.

--With assistance from Julie Cruz, David Merritt, Andrew Reierson, Daniel Tilles, Stuart Wallace and Jason Webb in London. Editors: Stephen Kirkland, Justin Carrigan

To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net

To contact the editor responsible for this story: Paul Sillitoe in London at psillitoe@bloomberg.net

Lufthansa to Cram in 2,000 More Seats by Using Slimmer Backrests

Posted: 25 Nov 2010 04:11 AM PST

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By Cornelius Rahn

Nov. 25 (Bloomberg) -- Deutsche Lufthansa AG, Europe’s second-biggest airline, said it will add almost 2,000 more seats to its single-aisle fleet by the end of next year by switching to berths with slimmer backrests.

The seats will allow Lufthansa to add as many as two extra rows, equivalent to 12 passengers, to each plane while boosting legroom by 5 centimeters (2 inches), spokesman Jan Baerwalde said today by telephone. The revamp involves about 200 aircraft which can currently carry about 33,000 people, he said.

The revamp, which covers both business and coach classes, is the first for Lufthansa’s short-haul fleet since 2006. The Cologne, Germany-based carrier will also offer free snacks on its shortest flights for the first time in 15 years as it seeks to return fares to pre-slump levels and compete with discount carriers including Ryanair Holdings Plc and Air Berlin Plc.

The seats, to be unveiled at a presentation on Dec. 15, will offer a more ergonomic design, new color scheme and be “very similar” to those that Lufthansa unit Austrian Airlines installed in two planes this year, Baerwalde said. A new service concept will be part of the revamp, he said, declining to give details or reveal the cost of the project.

Lufthansa is separately spending as much as 400 million euros ($533 million) through 2013 to overhaul cabins on wide- body planes serving more than 80 long-haul routes following the introduction of its first Airbus SAS A380 superjumbos in May.

Ryanair said on Oct. 27 that it will cut 30 percent of flights at Frankfurt Hahn airport next summer, citing the introduction of an air-travel tax it says will make Germany an “uncompetitive tourist destination.”

Air Berlin said last week it will cut capacity by 5 percent as the tax renders some routes non-viable.

--Editors: Chris Jasper, Chad Thomas.

To contact the reporter on this story: Cornelius Rahn in Frankfurt at crahn2@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong in Berlin at kwong11@bloomberg.net

Ex-Blue Index Directors, Trader Charged With Insider Trading

Posted: 25 Nov 2010 04:01 AM PST

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By Lindsay Fortado

Nov. 25 (Bloomberg) -- Two former Blue Index Ltd. directors and a trader at the London derivatives broker were charged with insider dealing by the U.K. Financial Services Authority over claims they traded before seven merger announcements.

Blue Index’s co-owners, James Paul Sanders and James Swallow, and senior trader Christopher Hossain, were among five people charged at a London police station today, the FSA said in a statement. Former employee Adam Buck and Sanders’ wife, Miranda Sanders, were also charged in the case.

James Paul Sanders was charged with three counts of disclosing inside information, and along with Hossain was accused of encouraging Blue Index clients to trade contract-for- differences related to two stocks. Hossain also faces a further charge of insider dealing ahead of a merger announcement.

All five were released on bail and are scheduled to appear in court in December. Blue Index trading was halted after arrests were made in the investigation in May 2009, the FSA said.

Kevin Robinson, a lawyer for the Sanders, didn’t immediately return a call seeking comment. David Corker, a lawyer for Swallow, declined to comment.

--Editors: Anthony Aarons, Chris Jasper

To contact the reporter for this story: Lindsay Fortado in London at lfortado@bloomberg.net.

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net.

EU May Ban Some UN Offsets to Stop ‘Windfall’ Profits

Posted: 25 Nov 2010 03:49 AM PST

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By Ewa Krukowska

(Adds market reaction in second paragraph.)

Nov. 25 (Bloomberg) -- The European Union proposed banning some credits linked to industrial-gas projects in its carbon program from the start of 2013, limiting the options available to the continent’s emitters to cut pollution costs.

The European Commission, the regulatory arm of the 27- nation EU, wants to prohibit United Nations-sponsored offsets related to hydrofluorocarbon-23 and nitrous oxide in response to concern they create “windfall” profits for investors and undermine the market’s integrity. The discount of UN credits relative to EU allowances for delivery in 2012 widened 3.1 percent today in London to the most since May 20.

More than 11,000 facilities in the EU cap-and-trade program may use UN credits as a cheaper alternative to EU allowances for compliance with their pollution quotas. Regulators of the UN carbon market are also ramping up scrutiny after allegations that some developers are seeking excessive credits on projects tied to HFC-23, whose warming potential is 11,700 times more powerful than CO2.

“The acceptance of credits from industrial-gas projects has been controversial for some time,” the commission said in a statement in Brussels today. “Certain gases have a very high global-warming potential, and abatement is very cheap. This can create huge financial rewards for project developers.”

The commission proposed banning the use of credits linked to the two industrial gases from adipic acid production from the UN Clean Development Mechanism, the world’s second-biggest market, and the Joint Implementation program.

Fragmented Market

“The Commission’s decision to ban HFC and N2O credits from Jan.1, 2013, is very much in line with our expectations,” said Aimie Parpia, a London-based analyst at Bloomberg New Energy Finance. “We expect the UN carbon market to fragment, with industrial gas credits trading at a considerable discount to renewable energy, energy efficiency and agriculture credits.”

The EU emissions-trading program is a cornerstone of European efforts to tackle the heat waves, storms and floods tied to climate change. The system, started in 2005 with a three-year trading period, is now in a second phase and will enter a third stage running from 2013 through 2020.

Abundant Alternatives

In the current five-year trading period, the installations in the program can swap as many as 1.6 billion UN credits with EU permits on a one-for-one basis. The EU average annual emissions cap for that period is 2.04 billion tons of carbon dioxide, valued at around 31 billion euros at today’s prices. One permit represents one ton of CO2.

“There are expected to be enough credits available from the 2,300 other projects (non HFC-23, non- N2O) to supply the EU ETS up to the limit allowed over the next 10 years, without including any new credits from sectoral crediting,” the commission said. “Therefore allowance prices should be relatively unaffected. ”

UN offset credits generated under the CDM, known as Certified Emission Reductions, are awarded to pollution-cutting projects in developing nations. The UN Joint Implementation mechanism issues the so-called Emission Reduction Units.

The commission and environmental campaigners including CDM Watch are concerned that overseas plants that reduce hydrofluorocarbon gases called HFC-23 may be increasing output simply to generate credits, handing investors windfall profits.

‘Cheap Reductions’

“The EU considers that cheap emission reductions, such as those from certain industrial gas projects, should not be done through the carbon market, but instead should be the responsibility of developing countries as part of their appropriate own action or possibly funded based on incremental costs only,” the commission said.

The commission proposal will require EU member state approval to become binding. Climate Commissioner Connie Hedegaard, who has also called for international action to phase out the production of hydrofluorocarbons, said on Oct. 15 the bloc’s nations will likely support curbs on the use of offsets from industrial gases in the EU emissions program.

The climate change committee, composed of national governments officials and chaired by the commission, will first discuss the proposal on Dec. 15, according to today’s statement.

The CDM Executive Board is due to discuss at its meeting due to end Nov. 26 whether the methodology for awarding those offsets should be changed.

To contact the reporter on this story: Ewa Krukowska in Brussels at ekrukowska@bloomberg.net;

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

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