WHAT THE OTHER PAPERS SAY THIS MORNING

FINANCIAL TIMES

BOND STRATEGY LED TO BIG WIN AFTER LEHMAN
The collapse of Lehman Brothers and central banks’ unorthodox monetary policies distorted markets to create some of the biggest pricing anomalies ever documented in bond trading, according to research from leading US academics. A paper from the US National Bureau of Economic Research claims to have identified by academic research in fixed income markets the “largest arbitrage ever”.

BA CHIEF WARNS EUROPE OF THREAT FROM MIDEAST AIRLINES
Europe has failed to recognise the “significant threat” of ambitious Middle Eastern airlines, the head of British Airways has warned. Willie Walsh told industry leaders: “We have been very slow in the UK and in Europe to recognise the new competitive threat.

CARDINAL COMPARES UK TO THIRD WORLD
The start of Pope Benedict XVI ‘s state visit to Britain starting on Thursday has been marred by one of his senior advisers, who has described the UK as “a third world country” marked by a “new and aggressive atheism”. As the Pope prepares for what will be the first official visit ever made to the UK by a Catholic pontiff, Cardinal Walter Kasper, a former adviser on relations with other denominations, triggered controversy by making the comments in a German magazine article.

CAMBRIDGE TOPS UNIVERSITY RICH LIST
The University of Cambridge is now comfortably Britain’s richest university, confirming its place in the global top 10 of academic endowments with £4bn, after a strong investment performance and a billion-pound fundraising drive.

THE TIMES

REVENUE FEELS THE HEAT FOR FIASCO OF UNDERPAID TAXES
The chairman of the Treasury Select Committee has launched a scathing attack on HM Revenue & Customs over its handling of the tax fiasco that has left millions facing claims for backdated tax. Andrew Tyrie told The Times that HMRC had failed to prepare itself to deal with taxpayer concern.

AVIVA CALLS IN HEADHUNTERS TO SEEK OUT NEW CHAIRMAN
Aviva has begun the search for a new chairman to replace Lord Sharman, opening up a further vacancy at the top of corporate Britain, The Times has learnt. Britain’s second-largest insurer has appointed several headhunters to draw up a list of potential replacements for Lord Sharman, 67, who has held the role for five years.

The Daily Telegraph

CATTLES BONDHOLDERS ENDS RESTRUCTURING TALKS
Cattles, the stricken door-to-door lender, said on Wednesday that talks with its group of bondholders over a restructuring had broken down. The company said in a statement on Wednesday that it would continue talks with other key creditors to find a solution.

BANK OF JAPAN RILES US WITH YEN MOVE
Japan has launched a huge intervention in the foreign exchange market for the first time since 2004 to stem the rise of the yen and head off a deflation spiral, prompting harsh protests from top US Democrats on Capitol Hill. The move is the latest dramatic twist in a world where a growing number of countries are seeking an economic edge.

WALL STREET JOURNAL

BA CHIEF SAYS LAN MERGER ISN'T THREAT TO ONEWORLD
British Airways PLC Chief Executive Willie Walsh said Chilean carrier LAN Airlines SA's pending merger with Brazil's TAM S/A isn't a threat to the Oneworld airline alliance, which includes BA. “LAN are very much core members of Oneworld,” Walsh said in an interview. BA, LAN, AMR Corp’s American Airlines and 11 other airlines belong to Oneworld, through which they cooperate on marketing and strategic planning.

RUSSIA, NORWAY RESOLVE DISPUTE OVER MARITIME BORDER
Russia and Norway signed an agreement Wednesday on their maritime border in the energy-rich Barents Sea, ending a dispute that has dragged on for decades. The countries said the deal was significant.