Zero-interest financing, a familiar sales incentive at car dealerships and furniture stores, has found its way to another big-ticket consumer market: doctors’ and dentists’ offices, the New York Times reported today. For $3,500 laser eye surgery, $6,000 ceramic tooth implants or other procedures not typically covered by insurance, millions of consumers have arranged financing through more than 100,000 doctors and dentists that offer a year or more of interest-free monthly payments. As the price of health care continues to rise and big lenders pursue new areas for growth, this type of medical financing has become one of the fastest-growing parts of consumer credit, led by lending giants like Capital One and Citigroup and the CareCredit unit of General Electric.

A bankruptcy judge has given the Roman Catholic Diocese of Davenport an extension to file its reorganization plan by Oct. 1, the Associated Press reported yesterday. The original deadline was Aug. 15. The request to extend the deadline was submitted by the diocese and the creditors committee, which includes alleged victims of abuse by priests. A total of 156 claims from alleged abuse victims have been filed in the case, according to court records. The plan must be approved by Nov. 30.

First Magnus Financial Corp., the second-largest privately held U.S. mortgage company, filed for bankruptcy less than one week after it shut down its lending operations, Bloomberg News reported yesterday. First Magnus had $942.1 million in assets and $812.5 million in debt as of May 31, according to its chapter 11 petition filed today in federal bankruptcy court in Tucson, Ariz. The company said on Aug. 16 that it shut down its lending operation after investors quit buying the company’s loans. Today’s court filing makes it the 14th lender since December to seek bankruptcy protection and one of more than 90 to either shut down or seek a buyer. The case is In re First Magnus Financial Corp. 07-01578, U.S. Bankruptcy Court, District of Arizona (Tucson).

Shut out of the short-term debt market by an expanding credit crisis, Countrywide Financial, the nation’s largest mortgage lender, turned yesterday to 40 of the biggest banks, borrowing $11.5 billion as it tried to shore up its cash, the New York Times reported yesterday. Countrywide said that it would make significant changes in its operations by largely limiting itself to only the safest mortgages that can be bought by Fannie Mae and Freddie Mac, the government-chartered agencies. In the first six months of 2007, the company made $245 billion in home loans, 17.4 percent of the total nationwide. Analysts say Countrywide is likely to have a better chance of surviving than many of its rivals. For one thing, it had a contingency plan that included the committed bank loans it used yesterday. The company also has a bank subsidiary, Countrywide Bank, which it plans to use to make the majority of its loans by the end of September.

The European Central Bank declared yesterday that recent financial market turmoil was largely over, a sign that the bank would probably proceed with a plan to increase borrowing costs in early September to curb inflation caused by a rising economy, the New York Times reported today. The liquidity problems in the last week, which central banks around the world smoothed over with large cash infusions, had led many investors to reassess whether the European Central Bank would tighten credit when it meets Sept. 6. Data released Tuesday showed that the pace of economic growth in the 13-nation euro zone slowed in the second quarter to 0.3 percent, about half the rate of the first quarter. France and Germany, the two largest euro members, registered 0.3 percent growth in the same period, less than economists had forecast, but in line with the central bank’s prognosis of steady growth that would allow it to raise its benchmark rate by a quarter-point.

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The Aegis Mortgage Corp., a subprime lender based in Houston, filed for bankruptcy protection yesterday, joining a growing list of companies hurt by investors’ unwillingness to finance home loans for borrowers with poor repayment histories, Bloomberg News reported today. The company said that it owed more than $100 million to creditors, including some of the investment banks that until this year financed many loans to subprime borrowers. The petition, listing more than $100 million in assets to pay as many as 5,000 creditors, was filed in Federal Bankruptcy Court in Wilmington, Del. Aegis is 81 percent owned by an affiliate of the New York hedge fund manager Cerberus Capital Management, according to a bankruptcy court filing. Among Aegis’s largest creditors are units of Morgan Stanley, owed $16 million, and Countrywide Financial Corporation, the biggest American mortgage lender, owed $14.3 million.

Polish telecom and power conglomerate Elektrim has filed for bankruptcy with a Polish court in the latest episode in a fight over its mobile telecom assets and debts to bondholders that stretches back several years, AFXNews.com reported on Friday. Elektrim said that it had asked the court to rule on the divide of its disputed assets, which include a controlling stake in power group PAK, the subject of a bid for control by copper producer KGHM. The company is also involved in Deutsche Telekom and Vivendi’s long legal battle for control of Poland’s third-largest mobile network PTC, relating to a 1990s joint venture with Elektrim. Almost all of Elektrim’s assets are tied up in claims by holders of bonds it issued in several years ago. A court suspended proceedings the last time it filed for bankruptcy in 2003.

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A  U.S. judge threw out complaints by two former subsidiaries of Parmalat SpA  against several banks and accounting firms over the Italian dairy company’s 2003 collapse in Europe’s largest bankruptcy, Reuters reported today. U.S. District Judge Lewis Kaplan in Manhattan yesterday dismissed the second amended complaints in cases filed by the two companies, Parmalat USA Corp and Farmland Dairies LLC. The defendants included Bank of America Corp., Credit Suisse and Italy’s Banca Nazionale del Lavoro and Banca Intesa, as well as accounting firms Deloitte Touche Tohmatsu and Grant Thornton International. The two companies had alleged that the banks and accounting firms helped conceal Parmalat’s true financial condition, according to the ruling. Parmalat collapsed under about 14 billion euros ($19.15 billion) of debt after uncovering a 4 billion euro ($5.47 billion) hole in its accounts. It emerged from bankruptcy in 2005.
See Also:  Bankruptcy New York

A Moscow court has extended the mandatory sale of bankrupt Russian oil company YUKOS’s remaining assets by three months, Reuters reported today. The Russian government declared YUKOS bankrupt in early August 2006 and gave the company 12 months to sell its assets.  Russian state-owned oil producer Rosneft bought most of YUKOS’s oil-producing and refining assets over the past year, but the firm’s receiver has yet to sell YUKOS’s foreign units and its railway transportation division.  The transport assets of YUKOS will be auctioned in Moscow tomorrow with a starting bid of 18.5 billion rouble ($726.3 million). YUKOS had around 7,000 railway cars prior to its bankruptcy.

See Also:  Chicago Bankruptcy

General Motors Corp., while reporting better-than-anticipated results in the second quarter, gave little reason to be overly optimistic about its turnaround prospects in North America.  In fact, the Detroit, Mi. automaker’s strong profit in the quarter could make it tougher to negotiate pay and healthcare concessions with its unions.  Further, while GM reported an $891 million profit in the second quarter, including $520 million in special items, the firm still lost $39 million in North America, although that’s an improvement over a nearly $4 billion loss, including charges, in the year-earlier second quarter.  Overall revenue was down 13%–to $46.8 billion. Among GM’s biggest challenges is its cost structure.  For example, take GM’s profit of $65 per car that it sells in North America, compared to an estimated $1,200 per car that Toyota Motor Corp. and Honda Motor Co. make.