Daily Insolvency News Headlines

Wed., January 21, 2015

Wed., January 21, 2015

China’s economy grew at its slowest pace in 24 years in 2014 as property prices cooled and companies and local governments struggled under heavy debt burdens, keeping pressure on Beijing to take aggressive steps to avoid a sharper downturn, the Irish Times reported. For investors worried about growth in China and the world this year, the data poses two questions: Will the soft numbers and expectations of further weakness force the central bank to pump hundreds of billions of dollars into banks system-wide to prop up growth? And if so, what does that mean for Beijing’s attempts to reform its economy? The world’s second-largest economy grew 7.4 per cent in 2014, official data showed on Tuesday, barely missing its official 7.5 per cent target but still the slowest since 1990, when it was hit by sanctions in the wake of the Tiananmen Square crackdown. Read more.

Wed., January 21, 2015

Swedish oil and gas firm PA Resources will write down the value of its assets by 2.1 billion Swedish crowns ($258.6 mln) due to the plunge in oil prices and may be forced to go into liquidation, the company said on Tuesday, Reuters reported. "The loss arising from the impairment charge will most likely result in the company's shareholders' equity being less than one-half of the registered share capital. As a consequence, the company's board of directors has resolved to prepare a balance sheet for liquidation purposes," PA said. As a result of the writedowns, PA Resources is also in breach of its bond covenants and said it will probably convene a shareholder meeting to decide whether or not to raise capital to continue its operations. Read more.

Wed., January 21, 2015

Demand for mortgage loans increased in the final quarter of last year ahead of expected new stricter lending rules, the Irish Times reported. According to the Central Bank bank’s latest quarterly lending survey, the potential introduction of stricter loan-to-value criteria resulted in “an acceleration of demand”. However, the survey, which examines credit market conditions for households and businesses, the strength of the reported increase in demand was lower than the record level reported in the third quarter. The Central Bank is expected to introduce new lending restrictions this year, which could require home buyers to have a deposit of 20 per cent of the property’s purchase price. Traditionally, Irish house buyers have been able to secure 90 per cent loans, albeit in the bubble years borrowers were regularly given 100 per cent. Overall, the bank’s survey found credit standards on loans to households for house purchases remained unchanged during the final quarter of last year. Read more.

Wed., January 21, 2015

Spain’s residential real-estate recovery is a tale of two cities: Madrid and Barcelona, The Wall Street Journal reported. Barcelona is the only city in Spain to post an annual increase in home prices during 2014. Prices in the city rose 2.8%, with some neighborhoods gaining as much as 8%. Madrid, too, has fared better than most. While it hasn’t enjoyed price gains, Madrid’s decline of 4.9% last year was better than the 5.7% drop for Spain overall, according to fotocasa.es, a Spanish property website. The price performance in Madrid and Barcelona helps explain why Spain’s construction sector is expected to make a comeback in 2015 after seven comatose years, as demand grows amid a modest economic recovery. Most of the building will take place in Spain’s two biggest cities. The construction comes as Spain tries to digest an estimated one million unsold empty houses, which can seem “counterintuitive,” says Fernando Encinar, head of research at idealista.com, a Spanish property website. “In 2015, there will be a high level of housing stock at the national level, but a deficit of housing in certain markets that will allow for the construction of new homes.” Read more. (Subscription required.)

Wed., January 21, 2015

Irish development and investment group Ardale Property has completed its acquisition of Weslin Construction, which was in examinership. The €500,000 deal will save 15 jobs and position Ardale across a number of sectors, the Irish Times reported. Alan Hegarty, of Ardale Property Group, said that the investment “was an easy one”. “We would not have made this investment unless we felt we could bring Weslin forward. With our experience across residential, retail and commercial property, we can move together, offering a wealth of experience to clients, backed up with a diverse portfolio of projects in the property sector.” Weslin, which was founded in 2000 and has experience in residential, retail, commercial new build and fit out, industrial and civil engineering, had been in examinership since March 3rd. Read more.

Wed., January 21, 2015

Ukraine isn’t planning to restructure its debt and is working with the International Monetary Fund on a “sustainable program” to fight a recession and sinking foreign reserves, the nation’s acting deputy central bank head said, Bloomberg Businessweek reported. “We are a good a borrower and we want to follow the credit history of Ukraine and therefore this discussion on restructuring is not on the table now,” Vladyslav Rashkovan said Tuesday in an interview in Vienna. Debt restructuring is “absolutely,” he said. Ukraine is grappling with sagging reserves and the worst economic contraction since 2009 after nine months of battling pro-Russian insurgents in the easternmost Donetsk and Luhansk regions. The unrest left the hryvnia down 48 percent against the dollar last year and prompted the government to seek financial help on the top of a $17 billion loan from the IMF. Read more. <

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