ATHENS — Fitch cut Greece’s long-term ratings on Wednesday to its lowest rating above a default, becoming the first ratings agency to make the widely expected downgrade after the country announced a bond exchange plan to ease its massive debt burden.

It said Greece would be designated as having technically defaulted after the bond exchange is formalized, but the new bonds would be give and new rating.

All three big ratings agencies — Fitch, Moody’s and Standard Poor’s — downgraded Greece in July when an initial debt swap plan was unveiled and have warned that losses for private creditors would trigger a temporary default.

As expected, Fitch said it was downgrading Greece to “C” from “CCC,” and would follow up with further downgrade to a “restricted default” when the bond swap is completed.

It will then reassess the country’s ratings when new bonds are issued as part of the debt exchange.

“It would come out to a low, speculative grade rating,” Fitch analyst Paul Rawkins told Reuters on the ratings after the reassessment, noting that rating would factor in the country’s economic prospects and new debt profile.

He added that the current process of downgrades was largely procedural, following the path laid out by the agency in June. Ratings, which give an estimate of the capacity of a creditor to repay its debt, usually serve as a guide to investors.

Euro zone finance ministers agreed a 130-billion euro rescue plan for Greece on Tuesday to avert a messy default, including a bond swap to shave 100 billion euros off Greece’s debt burden.

Bondholders will take losses of 53.5 percent on the nominal value of their Greek bonds as part of the swap, with actual losses put at around 74 percent in real terms.

The European Central Bank fas agreed to a complex plan to ensure Greek bonds can still be used as collateral in its lending operations whilst in the process of being swapped.

Greece will take a loan from the European Financial Stability Facility (EFSF) which will come in the form of EFSF bonds. Those bonds will passed to ECB and put into a special account incase there are any losses on collateral during the short window of the bond swap.

Copyright 2012 Thomson Reuters. Click for restrictions.

“We sowed the wind, now we reap the whirlwind,” said Vassilis Korkidis, head of the Greek Commerce Confederation. “The new bailout is selling us time and hope at a very high price, while it doggedly continues to impose harsh austerity measures that keep us in a long and deep recession.”

EXTRA RELIEF

A report prepared by experts from the European Union, European Central Bank and International Monetary Fund said Greece would need extra relief to cut its debts near to the official debt target given the worsening state of its economy.

If Athens did not follow through on economic reforms and savings to make its economy more competitive, its debt could hit 160 percent by 2020, said the report.

“Given the risks, the Greek program may thus remain accident-prone, with questions about sustainability hanging over it,” the nine-page confidential report said.

The beefed-up monitoring of implementation of the reforms could bolster accusations among some Greeks of interference in domestic affairs but some critics say that is essential.

Dutch Finance Minister Jan Kees de Jager, one of Athens’ most strident critics, told Dutch news agency ANP he had bargained hard for the permanent monitoring mission.

“This program is not something to cheer about,” he said.

BOND SWAP

The accord will enable Athens to launch a bond swap with private investors to help put it on a more stable financial footing and keep it inside the euro zone.

About 100 billion euros of debt will be written off as banks and insurers swap bonds they hold for longer-dated securities that pay a lower coupon.

Private sector holders of Greek debt will take losses of 53.5 percent on the nominal value of their bonds. They had agreed to a 50 percent nominal writedown, which equated to around a 70 percent loss on the net present value of the debt.

Juncker said he expected a high participation rate in the deal, a view echoed by the German banking association.

Greece said it would legislate to allow it to enforce losses on bondholders who do not take part voluntarily.

Euro zone central banks will also play their part.

A Eurogroup statement said the ECB would pass up profits it made from buying Greek bonds over the past two years to national central banks for their governments to pass on to Athens “to further improve the sustainability of Greece’s public debt.”

The ECB has spent about 38 billion euros on Greek government debt with a face value of about 50 billion euros.

The private creditor bond exchange is expected to launch on March 8 and complete three days later, Athens said on Saturday. That means a 14.5-billion-euro bond repayment due on March 20 would be restructured, allowing Greece to avoid default.

The vast majority of the funds in the program will be used to finance the bond swap and ensure Greece’s banking system remains stable; some 30 billion euros will go to “sweeteners” to get the private sector to sign up to the swap, 23 billion will go to recapitalize Greek banks.

A further 35 billion or so will allow Greece to finance the buying back of the bonds. Next to nothing will go directly to help the Greek economy.

Copyright 2012 Thomson Reuters. Click for restrictions.

Georges Gobet / AFP – Getty Images

Eurogroup president Jean-Claude Juncker and International Monetary Fund Managing Director Christine Lagarde celebrate the latest deal to bail out Greece. Their jubilation may be premature.

In their jubilant celebration over the latest agreement to solve Greece’s debt debacle, European officials forgot to check with two important groups: the Greek voters and the bondholders who lent Athens the money it now says it can’t pay back.

The agreement once again buys the eurozone some time. Greek officials agreed to deeper spending cuts of 325 billion euros ($430 billion) and stricter budget oversight by the European Union. They also agreed to ask investors to accept less than 50 cents on the dollar on Greek bonds they hold.

If all goes well, Athens will once again dodge bankruptcy with the infusion of the latest,  $172 billion (€130 billion) installment in the ongoing bailout of the rapidly contracting Greek economy.    

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But the ink was barely dry before the top official of the International Monetary Fund, which has to sign off on the payment, gently reminded the parties that two important conditions still need to be met.

“As soon as the prior actions agreed with the Greek authorities are implemented and adequate financial contribution from the private sector (bondholders) is secured, I intend to make a recommendation to our Executive Board regarding IMF financing to support a program,” Christine Lagarde, Managing Director said in a statement.

The first condition — making those $430 billion in budget cuts stick — is a tall order.

For the past four years, the Greek economy has been in a tailspin, shrinking by 20 percent as repeated rounds of government spending cuts imposed by European officials have stifled economic growth, further shrinking the country’s tax base and fueling a vicious downward spiral. The Greek unemployment rate has more than doubled during that time; today, roughly half of Greeks aged 15- to 24-years-old are out of work. Each round of spending cuts has only intensified the economic pain on Greek citizens.

Greek voters will get a chance to weigh in on the deal in April, when parliamentary elections are scheduled. Candidates running on an “austerity” platform can expect an uphill battle in a country mired in a deep depression.  Earlier this month, riots flared in Athens and other Greek cities as thousands joined protest rallies, burning dozens of buildings and looting businesses. On Sunday, thousands of demonstrators in Athens staged a repeat anti-austerity protest.

The architects of Tuesday’ bailout deal are hoping that Greek voters believe continued membership in the European Union is worth the pain of the austerity measures being imposed as a condition for remaining part of the economic club.

The expectation is that leaders of the two main parties, the center-left Panhellenic Socialist Movement (PASOK) and the conservative New Democracy (ND), will win re-election and form a coalition that enforces spending cuts European officials are demanding.

“Certainly (the parties) will publicly voice their disgust with the program, but privately they will continue to go along with it,” said Douglas Borthwick, a currency trader at Faros Trading.

But that scenario may prove overly optimistic. Support for the two main parties is at historic lows, providing an opening for smaller left-leaning parties opposed to the spending cuts, according to IHS Global Insight economist Diego Iscaro and country analyst Blanka Kolenikova.

“If the current polls prove true when the general election is held, neither the ND nor the PASOK would secure sufficient support to create a majority government,” they wrote in a note to clients Tuesday. “The winning party would be then forced to team up with smaller, radical parties, which would bring uncertainty and instability mid-term.”

Some observers doubt Europe’s demands are possible — no matter who is elected.

“The package is based on unrealistic economic assumptions and will be no more successful than the first deal,” said Ben May, an economist at Capital Economics. “Accordingly, Greece or (European officials) may still decide to terminate the bail-out within months.”

The bailout bargain faces another hurdle well before the election, when Greece faces a March 20 deadline to come up with a 15 billion euro ($20 billion) bond payment it can’t make. To head off that default, Tuesday’s bailout bargain calls for Greece to tell bond holders they’ll have to “volunteer” to accept less than half of what they’re owed.

Though Greece has not yet technically defaulted, investors fearing they won’t get their money back have already bid down the value of more than 400 euros of government debt outstanding.  

“For some reason, this is not officially being labeled a ‘default’ even though more than 100 billion euros of Greek debt are being written off by private bondholders,” said David Rosenberg chief economist at Gluskin Shiff.

The latest bond write down demanded by Tuesday’s deal would inflict even heavier losses than past proposals. Much of that “haircut” will be taken by European banks, who are now borrowing at record low rates from the European Central Bank. The hope is that those low rates will help them offset the hit they’ll take when Greece pays them back less than it originally promised.

But those losses also will be inflicted on private investors, including hedge funds who have been gambling that the government won’t come up with the money to pay them back. They’ve been betting against full payment with so-called “credit default swaps” — a kind of insurance policy that pays off when a borrower defaults.  That leaves them little incentive to agree to the deal. 

If too many private bond holders refuse to take the haircut, those credit default swaps could be triggered — with largely unknown consequences. In 2008, the cascading impact of credit default swaps sparked by the collapse of Lehman Brothers touched off a global financial panic.

So until Greek voters and bond holders agree to go along, Tuesday’s long-awaited grand bargain may turn out to be just one more in a series of partial solutions that failed to resolve the crisis.

“All the authorities have been able to do is delay default by a few weeks, perhaps a few months at best,“ hedge fund manager Dennis Gartman wrote in his investor newsletter. “Greece will default, but perhaps not under the present government in power.”

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{“contentId”:”10468865″,”totalVotes”:”138″}

Jennifer McKeown, senior European economist at Capital Economics, said: “The austerity measures it will have to implement and increased monitoring by the troika amidst public outrage will make things harder and drive it deeper into recession. There is a risk of a euro zone exit later this year.”

A return to economic growth in Greece could take as much as a decade, a prospect that brought thousands onto the streets of Athens to protest on Sunday. The cuts will deepen a recession already in its fifth year, hurting government revenues.

“We sowed the wind, now we reap the whirlwind,” said Vassilis Korkidis, head of the Greek Commerce Confederation. “The new bailout is selling us time and hope at a very high price, while it doggedly continues to impose harsh austerity measures that keep us in a long and deep recession.”

EXTRA RELIEF

A report prepared by experts from the European Union, European Central Bank and International Monetary Fund said Greece would need extra relief to cut its debts near to the official debt target given the worsening state of its economy.

If Athens did not follow through on economic reforms and savings to make its economy more competitive, its debt could hit 160 percent by 2020, said the report.

“Given the risks, the Greek program may thus remain accident-prone, with questions about sustainability hanging over it,” the nine-page confidential report said.

The beefed-up monitoring of implementation of the reforms could bolster accusations among some Greeks of interference in domestic affairs but some critics say that is essential.

Dutch Finance Minister Jan Kees de Jager, one of Athens’ most strident critics, told Dutch news agency ANP he had bargained hard for the permanent monitoring mission.

“This program is not something to cheer about,” he said.

BOND SWAP

The accord will enable Athens to launch a bond swap with private investors to help put it on a more stable financial footing and keep it inside the euro zone.

About 100 billion euros of debt will be written off as banks and insurers swap bonds they hold for longer-dated securities that pay a lower coupon.

Private sector holders of Greek debt will take losses of 53.5 percent on the nominal value of their bonds. They had agreed to a 50 percent nominal writedown, which equated to around a 70 percent loss on the net present value of the debt.

Juncker said he expected a high participation rate in the deal, a view echoed by the German banking association.

Greece said it would legislate to allow it to enforce losses on bondholders who do not take part voluntarily.

Euro zone central banks will also play their part.

A Eurogroup statement said the ECB would pass up profits it made from buying Greek bonds over the past two years to national central banks for their governments to pass on to Athens “to further improve the sustainability of Greece’s public debt.”

The ECB has spent about 38 billion euros on Greek government debt with a face value of about 50 billion euros.

The private creditor bond exchange is expected to launch on March 8 and complete three days later, Athens said on Saturday. That means a 14.5-billion-euro bond repayment due on March 20 would be restructured, allowing Greece to avoid default.

The vast majority of the funds in the program will be used to finance the bond swap and ensure Greece’s banking system remains stable; some 30 billion euros will go to “sweeteners” to get the private sector to sign up to the swap, 23 billion will go to recapitalize Greek banks.

A further 35 billion or so will allow Greece to finance the buying back of the bonds. Next to nothing will go directly to help the Greek economy.

(Additional reporting by Luke Baker, Julien Toyer, Robin Emmott in Brussels, Daniel Flynn in Paris, Terri Kinnunen in Helsinki, Sarah Marsh in Berlin, Harry Papachristou and George Georgiopoulos in Athens, and Michele Kambas in Nicosia; Writing by Giles Elgood; Editing by Paul Taylor)

Copyright 2012 Thomson Reuters. Click for restrictions.

BRUSSELS — Euro zone finance ministers sealed a 130-billion-euro ($172 billion) bailout for Greece on Tuesday to avert a chaotic default in March after persuading private bondholders to take greater losses and Athens to commit to deep cuts.

After 13 hours of talks, ministers finalized measures to cut Greece’s debt to 120.5 percent of gross domestic product by 2020, a fraction above the target, to secure its second rescue in less than two years and meet a bond repayment next month.

By agreeing that the European Central Bank would distribute its profits from bond buying and private bondholders would take more losses, the ministers reduced the debt to a point that should secure funding from the International Monetary Fund and help shore up the 17-country currency bloc.

But the austerity measures wrought from Greece are widely unpopular among the population and may hold difficulties for a country which is due to hold an election in April. Further protests could test politicians’ commitment to cuts in wages, pensions and jobs.

Every government in the currency union will also have to approve the package. Northern creditors, such as Germany, had pressed for even tougher measures to be placed on Greece, but Finance Minister Wolfgang Schaeuble said he was very confident a majority in parliament would approve the package.

“We have reached a far-reaching agreement on Greece’s new program and private sector involvement that would lead to a significant debt reduction for Greece … to secure Greece’s future in the euro area,” Jean-Claude Juncker, who chairs the Eurogroup of finance ministers, told a news conference.

The euro gained in Asia after the bailout was agreed.

Some economists say there are still questions over whether Greece can pay off even a reduced debt burden.

A return to economic growth could take as much as a decade, a prospect that brought thousands of Greeks onto the streets to protest on Sunday. The cuts will deepen a recession already in its fifth year, hurting government revenues.

“We sowed the wind, now we reap the whirlwind,” said Vassilis Korkidis, head of the Greek Commerce Confederation. “The new bailout is selling us time and hope at a very high price, while it doggedly continues to impose harsh austerity measures that keep us in a long and deep recession.”

EXTRA RELIEF

A report prepared by experts from the European Union, European Central Bank and International Monetary Fund said Greece would need extra relief to cut its debts near to the official debt target given the worsening state of its economy.

If Athens did not follow through on economic reforms and savings to make its economy more competitive, its debt could hit 160 percent by 2020, said the report, obtained by Reuters.

“Given the risks, the Greek program may thus remain accident-prone, with questions about sustainability hanging over it,” the nine-page confidential report said.

The accord will enable Athens to launch a bond swap with private investors to help put it on a more stable financial footing and keep it inside the euro zone.

About 100 billion euros of debt will be written off as banks and insurers swap bonds they hold for longer-dated securities that pay a lower coupon.

Private sector holders of Greek debt will take losses of 53.5 percent on the nominal value of their bonds. They had agreed to a 50 percent nominal writedown, which equated to around a 70 percent loss on the net present value of the debt.

Juncker said he expected a high participation rate in the deal, but some bondholders may balk at the new terms.

Greece said it would pass legislation that would allow it to enforce losses on bondholders who will not take part.

Euro zone central banks will also play their part in reducing the debt.

A Eurogroup statement said the ECB would pass up profits it made from buying Greek bonds over the past two years to national central banks for their governments to pass on to Athens “to further improve the sustainability of Greece’s public debt.”

The ECB has spent about 38 billion euros on Greek government debt that is now worth about 50 billion euros.

The private creditor bond exchange is expected to launch on March 8 and complete three days later, Athens said on Saturday. That means a 14.5-billion-euro bond repayment due on March 20 would be restructured, allowing Greece to avoid default.

The vast majority of the funds in the 130-billion-euro program will be used to finance the bond swap and ensure Greece’s banking system remains stable; some 30 billion euros will go to “sweeteners” to get the private sector to sign up to the swap, 23 billion will go to recapitalize Greek banks.

A further 35 billion or so will allow Greece to finance the buying back of the bonds. Next to nothing will go directly to help the Greek economy.

(Additional reporting by Luke Baker, Julien Toyer, Robin Emmott in Brussels, Daniel Flynn in Paris, Terri Kinnunen in Helsinki, Sarah Marsh in Berlin, Harry Papachristou in Athens; Writing by Mike Peacock and Elizabeth Piper; editing by Timothy Heritage)

Copyright 2012 Thomson Reuters. Click for restrictions.

PARIS — European governments are ready to agree to a new bailout package for Greece, France’s finance minister said Monday ahead of a meeting with his counterparts in Brussels.

Francois Baroin told Europe-1 radio that while details will have to be worked out, “the political commitments have been made” for a new €130 billion ($171 billion) bailout for Athens.

“We now have all the elements of a deal — elements of a participation that remains voluntary for banks and private lenders, and for public lenders states, central banks,” he said.

“We don’t have money…Now our only target is to have food to survive,” Greek shopkeeper Michael Ipermahos says about the gravity of the financial crisis. “My advice to my children is to leave Greece, throw away their Greek passports and be a citizen of another country.”

A Greek’s only hot seller: Tear gas masks

“We hope we and the Eurogroup members can take into account all the Greek government has been done for several weeks — even several months,” he said.

Funds from the bailout, he said, would be placed in a “special-purpose account that makes it possible to signpost some of that money and guarantee Greece’s repayment of its creditors.”

The U.S. has expressed support for the IMF to take part in an aid program for Greece, whose government has faced violent protests over austerity measures aimed to avoid default next month.

While politicans argue, a Greek economist says it’s time to stop window-dressing and tell it as it is. NBC’s Jim Maceda reports.

The measures, coming after months of delay, would mark a second massive bailout for Athens. Critics doubt Greek political leaders’ commitment to austerity, and difficult details remain to be ironed out.

Europe’s economy edges closer to recession

Greece is straining to secure the rescue loans and the debt relief deal quickly to avoid defaulting on a €14.5 billion bond redemption on March 20. The government has already pushed a massive austerity and reform package though parliament and is expected to introduce in Parliament on Monday two more pieces of emergency legislation, including wage and pension cuts. There were scattered protests over the cuts in Athens on Sunday.

WASHINGTON — China has agreed to significantly improve market access for American movies, capping a weeklong visit by China’s leader-in-waiting that led to billions of dollars in business deals, Vice President Joe Biden said Friday.

“This agreement with China will make it easier than ever before for U.S. studios and independent filmmakers to reach the fast-growing Chinese audience, supporting thousands of American jobs in and around the film industry,” Biden said in a statement obtained by NBC News after Chinese Vice President Xi Jinping’s whirlwind tour to the United States. “At the same time, Chinese audiences will have access to more of the finest films made anywhere in the world.”

“U.S. studios and independent filmmakers cite China as one of their most important world markets, but barriers imposed by China and challenged by the United States in the WTO have artificially reduced the revenue U.S. film producers received from their movies in the Chinese market,” said United States Trade Representative Ron Kirk. “This agreement will help to change that, boosting one of America’s strongest export sectors in one of our largest export markets.”

Pool / Getty Images

Chinese Vice President Xi Jinping, left, shows Vice President Joe Biden a chocolate-covered macadamia nut, given to him by Hawaii Gov. Neil Abercrombie, at the start of a meeting of Chinese and American governors Friday at Disney Hall in downtown Los Angeles.

On a global basis, films and other audiovisual services create a $12 billion trade surplus in the sector for the United States, the White House said.

Last year, Chinese box office revenue was up to $2.1 billion, with much of that from 3D titles.

The agreement allows more American exports to China of 3D, IMAX, and similar enhanced-format movies on favorable commercial terms, the U.S. Trade Representative’s office said.

“This is a major step forward in spurring the growth of U.S. exports to China,” Chris Dodd, president of the Motion Picture Association of America (MPAA), said in a statement.

“It has long been a top priority for the MPAA, and it is tremendous news for the millions of American workers and businesses whose jobs depend on the entertainment industry.”

Walt Disney Co. president and CEO Robert Iger said in a statement obtained by The Hollywood Reporter: “China is one of the most populous countries in the world, and this agreement represents a significant opportunity to provide Chinese audiences increased access to our films.”

The U.S. movie industry has long complained about China’s tight restrictions on the number of foreign films allowed into the country each year, a limit that they say helps fuel demand for pirated DVDs that are widely available in China.

While the quota of 20 foreign films per year remains in place, Beijing granted other concessions that pleased Hollywood.

The deal strengthens the opportunities to distribute films through private enterprises rather than the state film monopoly, and ensures fairer compensation levels for U.S. blockbuster films distributed by Chinese state-owned enterprises, U.S. trade officials said.

The agreement will be reviewed after 5 years to ensure that it is working as envisioned, they said.

NBC News and Reuters contributed to this report.

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POTENZA, Italy — Italian police said on Friday they had seized about $6 trillion worth of fake U.S. Treasury bonds and other securities in Switzerland, and arrested eight Italians accused of international fraud and other financial crimes.

The operation, coordinated by prosecutors from the southern Italian city of Potenza, was carried out by Italian, Swiss and U.S. authorities after a year-long investigation, an Italian police source said.

It began as a investigation into mafia loan-sharking, but gradually expanded as prosecutors used telephone and computer intercepts to unearth evidence of illegal activity surrounding Treasury bonds.

The fake securities, worth more than a third of U.S. national debt, were seized in January from a Swiss trust company where they were held in three large trunks.

The U.S. Embassy in Rome thanked the Italian authorities and said the forgeries were “an attempt to defraud several Swiss banks.” It said U.S. experts had helped to identify the bonds as fakes.

Potenza’s prosecutor Giovanni Colangelo said an international network “in many countries” was behind the forgeries.

Italian daily Corriere della Sera said on its website that the criminal network was believed to be interested in acquiring plutonium, citing sources at the prosecutors’ office.

Police videos showed images of the trunks, with “Federal Reserve System, Treaty of Versailles” stamped on the side in large, golden letters.

Bond certificates marked “Chicago, Illinois, Federal Reserve Bank” and other securities, some for one billion dollars, were also shown.

U.S. bond traders took a light-hearted view of the news.

“If there’s that much less supply now, Treasuries should be rallying,” joked Kevin Flanagan, fixed-income strategist at Morgan Stanley.

A trader at Citigroup said he had swapped jokes with colleagues about the seizure, which would not move markets.

“It’s kind of like fake inflation I guess, if you take it to the max, but I don’t think it means that much.”

Prosecutors said the forgers had hoped to use the fake bonds as collateral to secure loans.

The eight men arrested are accused of counterfeiting bonds, credit card forgery, and loan-sharking in the Italian regions of Lombardy, Piedmont, Lazio and Basilicata, police said.

The Swiss Federal Prosecutor’s office said Zurich state prosecutors had worked on the investigation at the request of the Italian prosecutor. The Swiss handed over their findings in July last year.

In 2009, Italian financial police seized $742 billion of fake U.S. bearer bonds in the of Chiasso, on the Swiss-Italian border.

Copyright 2012 Thomson Reuters. Click for restrictions.

POTENZA, Italy — Italian police said on Friday they had seized about $6 trillion of fake U.S. Treasury bonds in Switzerland, and issued arrest warrants for eight people accused of international fraud and other financial crimes.

The operation, co-ordinated by prosecutors from the southern Italian city of Potenza, was carried out by Italian and Swiss authorities after a year-long investigation, an Italian police source said.

The fake securities, more than a third of U.S. national debt, were seized in January from a Swiss trust company where they were held in three large trunks.

The eight alleged fraudsters are accused of counterfeiting bonds, credit card forgery, and usury in the Italian regions of Lombardy, Piedmont, Lazio and Basilicata, police said.

The Swiss Federal Prosecutor’s office said Zurich state prosecutors had worked on the investigation at the request of the Italian prosecutor. The Swiss handed over their findings in July of last year.

In 2009, Italian financial police seized $742 billion of fake U.S. bearer bonds in the northern Italian town of Chiasso, near the Swiss border.

Copyright 2012 Thomson Reuters. Click for restrictions.

Turns out, it’s not just Apple’s mobile devices that are made in China: the name iPad was coined by Shenzhen Proview Technology more than a decade ago. Now the company is demanding that Apple fork over up to $2 billion if the Cupertino colossus wants to sell its popular tablet in mainland China.

Far from the factory floors where iPads are assembled, Proview’s Taiwanese affiliate sold rights to the name iPad years ago for around $55,000, but the financially troubled parent company —  which recently filed for bankruptcy — says those rights don’t apply to mainland China. Chinese media said Proview sought $1.6 billion in compensation for the name, although the Wall Street Journal reported Friday that its creditors are thinking bigger and want as much as $2 billion. 

The Chinese legal system has been relatively favorable to Proview thus far, dismissing an earlier suit brought by Apple asserting its right to the iPad name in mainland China. Local authorities have confiscated iPads for sale in 20 cities throughout the country. 

Proview so far has been unsuccessful in its more ambitious gambit to stop all iPad exports from China, a request that, if granted, would be a huge headache for Apple. 

China is Apple’s fastest-growing market, so it might be worth it for the tech company to dip into its sizable war chest and settle with its antagonist. Proview could certainly use the money. A Reuters reporter described visiting Proview’s factory in Shenzhen, only to find it abandoned and vandalized. 

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Apple iPads seized by China in name dispute