The Netherlands announced on Sunday that its government would pump in 10 billon euros into the bank ING Group after it became the latest casualty in the global financial crisis.

The capital injection into the bank would take the form of non-voting preferred shares and would amount to $13.4 billion. In return the government would acquire an 8.5% stake in the financial institution. According to ING, the capital infusion would enable the bank to withstand the chaotic economic environment and fluctuations in the current financial market.

ING was compelled to seek a government bail out after its shares fell more than 27% on Friday in Amsterdam. This happened after the company said it expected to incur losses of 500 million euros in the third quarter owning to write-downs of 1.6 billion euros. The massive plunge in shares on Friday evoked concerns that ING might collapse when trading resumed on Monday and this led to emergency talks between bank officials as well as representatives of the Dutch government and other central banks.

The Dutch government’s move to save ING from collapse marks the latest bid by international and national authorities to restore confidence among investors and inject enough liquidity into the system to encourage banks to resume lending.

The US financial meltdown has led to record levels of asset declines and investor redemptions in the hedge fund market over the third quarter, an industry research firm reported on Friday.

Hedge Fund Research, a Chicago-based firm announced on Friday that the chaos in financial markets has led to nervous investors taking out more than $31 billion from hedge funds during the quarter. This marks the largest net capital redemption in the history of the industry.

This redemption of capital by investors has shrunk industry assets by a record $210 billion for the third quarter. Most of the decline in industry assets has been due to investment losses. The decline in the quarter is far more than the $194 billion inflow for the whole of the last year.

Kenneth Heinz, president of Hedge Fund Research, pointed out that while the smaller investors have retreated because of the need for cash to fulfil other commitments like paying bills, the wealthier investors as well as historically strong institutions have not yet pulled out of hedge funds. This is because the high net worth clients depend upon hedge funds for a relatively minor portion of their portfolios and firms like Connecticut-based Cook Pine Capital dealing with such clients say they have not witnessed any such redemptions lately.

Mervyns, the US retail chain that filed for bankruptcy protection in July this year, has announced that it would hold going-out-of-business sales at its remaining 149 stores.

Falling prey to the continuing economic slowdown, California-based Mervyns became the latest retailer in bankruptcy to shut down operations across the country. The move by Mervyns comes in the wake of another retailer Linen n Things announcing on Tuesday its own plans of liquidation. The home goods department store Linen n Things had applied for bankruptcy protection in spring this year.

The collapse of popular retail chains comes after a slack back-to-school shopping season this year, since consumer spending has been greatly hampered by rising prices of gasoline and food as well as job cuts and stagnant wages. Traditionally, back-to-school season is a time of huge retail sales and comes second only to the Christmas holiday season in sales volume as well as revenues.

Last Wednesday, the US Commerce Department came out with a report which revealed a 1.2% decline in retail sales figures of September. This offers further proof of the ongoing tough times affecting the entire retail industry of the country. Unable to effect a turnaround, Mervyns’ officials have decided that holding going-out-of-business sales would be the best way to attract customers and pay back creditors.

Bank-to-bank lending rates registered a slight decline on Friday thus indicating that government initiatives to boost the economy were having an effect.

According to the British Bankers Association, the overnight Libor rate fell from 1.94% on Thursday to 1.67%, the lowest level since September 20, 2004 when the rate had sunk to 1.66%. Libor is the daily average of what sixteen different banks charge other banks to lend money in London and the rate also forms the basis of adjustable rate mortgages. The higher this rate, the more expensive the mortgages for homeowners. This decline in overnight Libor is quite significant considering that last Thursday, it had shot up to 5.09% and even peaked at 6.88% in the wake of the $700 billion US bail-out plan being signed into a law.

In a sign that government initiatives across continents were working to loosen the credit crunch, the three-month Libor rate also dipped for the fifth day in a row, coming down to 4.42% from 4.50% on Thursday. Even though it continues to remain at an elevated levels compared to a month-ago rate of 2.82%, it is still a comedown from the 4.82% mark that the three-month Libor had surged to last week which was the highest since December 2007.

Stock values of Advanced Micro Devices surged on Friday as the third quarter results of the chip manufacturer revealed signs of a financial turnaround.

Based in Sunnyvale, California, AMD is the chief competitor of Intel Corp as the maker of computer processors. In the most recent quarter AMD reported a loss of $67 million or 11 cents a share on revenues of $1.78 billion. This is a significant turnaround from earlier forecasts by analysts who were expecting the company to lose around 40 cents a share on revenues of $1.48 billion.

News of AMD’s better-than-expected third quarterly results led to a rise in its share prices which increased by 9 cents or 2.2% to close at $4.21. AMD’s stock values had sunk to a 52-week low on September 29 this year when it ended at $3.

The previous estimate made by analysts is not readily comparable to the recent quarterly results since AMD has posted a one-time $191 million income from technology licensing. However even after allowing for that subtraction, AMD’s performance appears to exceed predictions since it has bettered its third quarterly revenues from the second quarter by 17.5%. Financial analysts believe that AMD’s results show that the company may be back on its way to recovery.