Ukraine is finalising changes to legislation on bank insolvency in consultation with the International Monetary Fund as part of efforts by Kiev to secure a new loan programme, a senior state official told Reuters. Ukraine wants an IMF deal worth around $5 billion-6 billion over three years to support its economy and signal to investors that the new government of President Volodymyr Zelenskiy is committed to reform, Reuters reported.
Whether Brexit purists or radical socialists win Britain’s election next month, a deluge of fresh debt is set to bloat the country’s 1.6 trillion pound ($2.1 trillion) government bond pile, Reuters reported. But the permutations around the Dec. 12 election - and the implications for Brexit - make it tough for holders of British government debt to predict just what the borrowing bonanza will mean for them. In 2010, Bill Gross - then cast as “king of the bond market” - warned that British government bonds were “resting on a bed of nitroglycerine” because of Britain’s large budget deficit.
India’s state-run banks reported fraud worth 958 billion rupees ($13.3 billion) from April to end-September of this year, the country’s finance minister said on Tuesday, as the government struggles to help banks recoup losses, Reuters reported. State banks reported 5,743 cases of fraud in the period, most of which had taken place over the last several years, although 1,000 cases worth 25 billion rupees had just taken place, Nirmala Sitharaman told the upper house of parliament. “Government has taken comprehensive measures to curb the incidence of fraud in banks,” the minister said.
Proposals to reform the euro zone’s bailout fund are creating a political storm in Italy, where parties and institutions are battling over whether Rome should try to block the reform at the EU level, Reuters reported. A draft of the reform was agreed by euro zone finance ministers in June and is due to be finalised by leaders next month, but senior Italian officials, including its central bank chief, have warned some measures are financially dangerous.
South African investment firm RMB Holdings (RMH) said on Tuesday it planned to distribute among shareholders its stake in lender FirstRand , worth about 130 billion rand ($8.8 billion), as part of a restructuring, Reuters reported. RMH has an almost three-decade history of investing in financial services, and FirstRand was born out of the group. It is the bank’s largest shareholder with a 34% stake. RMH’s largest investor, Remgro Ltd, has an almost 4% stake in FirstRand.
Alpha Bank on Tuesday reported lower third-quarter profits after higher bad debt provisions and said it would launch a big securitisation of soured loans to clean up its balance sheet, Reuters reported. Alpha, 11% owned by the country’s bank rescue fund HFSF, reported net profit from continuing operations of 4.8 million euros after net earnings of 59.4 million euros in the second quarter. Provisions for bad debt rose 6.3% quarter-on-quarter to 261.5 million euros.
A co-operative bank has become the first German lender to pass on the cost of negative interest rates to new retail customers with small deposits, in the latest sign of how the European Central Bank’s policy is upending the country’s banking sector, the Financial Times reported. Volksbank Fürstenfeldbruck, which is located 30km west of Munich and has just €1.8bn in assets, said that it will collect a “depositary charge” of -0.5 per cent on instant access savings accounts with deposits of €1 and above.
Argentine President-elect Alberto Fernandez on Tuesday told International Monetary Fund Managing Director Kristalina Georgieva that he has a plan to grow the economy and tackle the nation’s debt after his predecessor agreed to a $56 billion credit line from the fund, Bloomberg News reported. “We have developed a sustainable plan that will allow us to grow and comply with our obligations that Argentina has with you and with the rest of the creditors,” Fernandez told Georgieva in their first publicly known phone call, according to his transition team’s press statement.
In a related story, Bloomberg News reported that Chinese technology conglomerate Tunghsu Group Co. is looking to extend its bond payment deadlines after failing to settle its obligations this week, in the latest sign that the nation’s private-sector firms are struggling to ease their debt load amid an economic slowdown. Beijing-based Tunghsu Group mainly produces photoelectric display components, but also operates new energy, real estate and other businesses. Its three listed companies -- Tunghsu Optoelectronic Technology Co., Tunghsu Azure Renewable Energy Co.
From Chinese conglomerates to coal miners in Indonesia, companies in Asia are facing rising financial stress, prompting fears defaults will pick up next year, Bloomberg News reported. Weaker regional borrowers with dollar bonds yielding at least 15% could come under further pressure next year, when they have about $15.1 billion or nearly a third of such debt due, according to Bloomberg-compiled data. Amid rising failures in China, some firms are finding it harder to refinance their debt offshore, while Indian shadow lenders are grappling with a liquidity crunch.
Resources by Country & Region
Country reports from the Czech Republic and Germany by Petr Sprinz, Jiří Rahm, Michael Thierhoff and Axel Roth
The Czech Republic: In January, an amendment to the Bond Act came into effect. The amendment prepared by the Czech Ministry of Finance comprises new rules governing secured bonds as well as the introduction of a security agent in connection with bonds.
German ESUG: In 2012 the German legislator enacted a landmark reform of the German Insolvency Code aiming at three main goals...
Turkey introduces new legislation regarding mandatory mediation for commercial disputes by Orçun Çetinkaya and Burak Baydar
Turkey has recently adopted new legislation requiring application to mandatory mediation for commercial disputes before filing a lawsuit.
The Law on Starting Legal Proceedings for Monetary Receivables Arising from Subscription Agreements, numbered 7155, published in the Official Gazette, numbered 30630 and dated 19 December 2018, introduced new provisions to the Turkish Commercial Code, numbered 6102 (“TCC”) and to the Law on Mediation in Civil Disputes, numbered 6325 (“Mediation Law”).
A judicial “cookbook” and recipes for international insolvency cooperation by Nicoleta Mirela Năstasie
In 2014, I attended a training programme related to guidelines and best practices for judicial cooperation in cross-border insolvency.
Explaining that in my daily judicial activity I had insufficient time to determine the most appropriate method to transform general guidelines and rules into concrete measures in pending litigations, someone asked me: “What do you want, Judge, a cookbook for insolvency?”
My direct and immediate answer was: “Yes, if a cookbook helps me to find practical solutions and be efficient”.
The speed of reforms across the world in insolvency law is truly breath-taking. In Europe and neighbouring countries, the pace has accelerated of late. Countries, such as Armenia, France, Greece, Latvia, Poland and Romania, inter alia, have within the past decade carried out reforms, many under very challenging economic conditions.
Almost a decade after the onset of the European debt crisis, Greece continues to struggle. While the country has managed to address many of its fiscal inconsistencies, the real economy has yet to reap the benefits of stabilisation, recording only a sluggish growth of 1.9% in 2018.
This updated edition describes the framework of the European Insolvency Regulation Recast (adopted in June 2017), reviews its major rules, highlights the differences from the old EIR 2000, and makes references to the most important and recent cases of the Court of Justice of the European Union. An essential guide for non-European judges, practitioners and scholars who are confronted with this domain of law, as well as anyone dealing with EU-related cross-border cases, this book serves as a concise and comprehensive introduction to the EIR Recast.
Chapter 15 for Foreign Debtors covers all aspects of the UNCITRAL Model Law on Cross-Border Insolvency as well as chapter 15 of the Bankruptcy Code, and provides details about the Foreign Representative, avoidance actions, creditor protections, concurrent proceedings, comity and much more. The book also includes an extensive appendix filled with more than 500 pages of sample case documents and forms related to chapter 15 proceedings.
This book is the latest addition to our list of publications and it provides basic information on Islamic finance. It is meant to be a useful reference tool to the majority of insolvency practitioners who do not work in this field. The chapters in this book were selected on the basis that it is expected that most INSOL members currently have very limited understanding of Islamic finance.
The book has 10 chapters, a country study, and an annexure with a glossary of Islamic finance terms. Following the introductory chapter there are chapters on: