Tata Steel has been in talks with bankers about potential plans to restructure the finances of Anglo-Dutch steelmaker Corus, as European markets struggle against a downturn in the steel sector.

If conditions in the steel market continue to deteriorate, the Indian steel producer could ask lenders to its UK arm – which owns Corus – to reset the covenants on some £3bn ($4.1bn) of loans put in place for the acquisition.