Dutch financial services group ING will combine its local insurance brands, aiming for an annual income boost of €100 million ($141 million) from 2013 after a restructuring which will include 800 job cuts, Reuters reported. ING's insurance operations Nationale-Nederlanden, RVS and ING Verzekeren Retail will be combined under the banner of the largest, Nationale-Nederlanden, the bancassurer said on Wednesday. ING was formed in 1991 when Nationale-Nederlanden and NMB Postbank Groep merged. ING will spend 165 million euros in the first four years for the overhaul of its Dutch insurance business, it said. Chief Executive Jan Hommen said the plan was part of ING's "back to basics" strategy, and the changes would better serve 5 million insurance clients in the Netherlands. After posting a loss in 2008 and getting a €10 billion injection from the Dutch state, ING unveiled a plan in April to slim down and shed assets. Read more.
Daily Insolvency News Headlines
Wed., July 1, 2009
No villas in the south of France for Russia’s top bankers this summer, if Vladimir Putin gets his way, the Financial Times reported. Russia’s prime minister has sternly warned bank chiefs not to plan any holidays until they have sorted out the financing of the country’s recession-hit economy. It will take a huge effort, with output forecast to fall by about 8 per cent this year and hopes of a quick recovery fading. Even the big state-owned banks that dominate the sector are under pressure, with VTB, the second-largest, warning of possible annual losses. The authorities last year stabilised markets by spending $200bn, slowing the rouble’s decline and injecting huge doses of cash into banks. But a modest pick-up in confidence has wilted since the rise in the oil price decelerated and amid mounting economic distress. Banks, scared mounting bad debts might reach 20 per cent of assets by the year-end, are understandably even slower to lend than their western counterparts. Read more. (Subscription required.)
The Japanese government has embarked on a controversial plan to prop up domestic electronics companies weakened by overseas competition and clobbered by the recession, echoing the automobile-industry bailout in the U.S., The Wall Street Journal reported. Japan said Tuesday it will invest 30 billion yen ($310 million) in Elpida Memory Inc. to help the semiconductor-maker survive the current downturn by beefing up its financial standing and modernizing its production facilities so it can compete with overseas rivals. This made Elpida the first company to participate in a new program here that puts public funds in nonfinancial companies, in exchange for stakes. Japan's program allows the government to make investments in manufacturers even before the companies near bankruptcy. The program targets nonfinancial companies with at least 5,000 employees that are deemed to have good prospects of revival within three years. Read more. (Subscription required.)
Pisces Group, the Australian mortgage broking platform provider chaired by former federal Liberal leader John Hewson, would be able to claw itself out of voluntary administration, The Australian reported. Pisces, the third company associated with Dr Hewson to have struck trouble, was placed in voluntary administration in June. The company's appointed administrator Rodgers Reidy Chartered Accountants' Robert Moodie said that the company would be able to trade its way out of debt under a deed of company arrangement that would see it undergo a restructure and may also lead to privatisation. The holding company, which operates through four trading subsidiaries, currently owes creditors a total of around $3.1 million. Its latest annual accounts indicate that profit slipped to a $13.5 million loss in the year to June 2008 from a profit of almost $1 million the previous year. It is estimated that the company's mortgage data broking platform currently serves around 40 per cent of mortgage broking market. Read more.
Zimbabwe’s prime minister, Morgan Tsvangirai, said Tuesday that an official he had appointed had secured lines of credit worth $950 million from China, President Robert Mugabe’s longtime ally, The New York Times reported. Mr. Mugabe’s party has mocked Mr. Tsvangirai for failing to bring home much aid from his three-week tour of the United States and Europe. Zimbabwe’s government — a virtually bankrupt contraption led by Mr. Mugabe and his rival, Mr. Tsvangirai — needs an estimated $8 billion to rebuild the country’s ruined economy. The West has been leery of giving the government a large infusion of money until Mr. Mugabe stops the human rights abuses that have been a fixture of his 29 years in power. China, however, has maintained its close relationship with Zimbabwe as it has extended its financial ties to other nations in Africa. Mr. Tsvangirai said Tuesday that the finance minister he had appointed, Tendai Biti, had negotiated the loan package with China. Officials close to Mr. Tsvangirai said they believed that at least some of the financing would be provided on the condition that the money was spent on Chinese goods, like fertilizer. Read more.
Cemex SAB, the largest cement maker in the Americas, takes its proposal for restructuring $14.5 billion of bank debt to Madrid today after presenting the offer to lenders in New York earlier this week, Bloomberg reported. Monterrey, Mexico-based Cemex is seeking to extend the maturity of the debt to February 2014 from the current 2009 through 2011, the company said yesterday. Cemex also said in a U.S. securities filing that it may need to issue debt, stock or equity-linked notes and that its auditors “expressed substantial doubt” about the company’s ability to stay in business. The Mexican cement producer said on June 15 it was working on a “comprehensive solution” to its bank debt. It announced talks to refinance debt with “core banks,” including Citigroup Inc. and Banco Santander SA, after it failed to sell $500 million of bonds in March. Read more.