Lebanon intends to ask for a seven-day grace period for a $1.2 billion Eurobond that matures on March 9, as it is entitled to, in order to give financial advisers more time to draft a restructuring plan, a government source said on Thursday, Reuters reported. Lebanon would seek the seven-day grace period ahead of the March 9 date, the source said. Financial sources said the exercising of the seven-day grace period would make it more likely the government would seek to restructure the March 2020 Eurobond. Lebanon faces two further Eurobond maturities this year, one in April and one in June.
Shares in Norwegian Air plunged a quarter in value on Thursday, leading airline stocks lower as investors bet the debt-laden budget carrier would be the most vulnerable to a coronavirus pandemic, Reuters reported. The slump in Norwegian shares to an 11-year low of 16.80 crowns came despite the company trying to reassure investors by reiterating its financial guidance. The stock has now lost 52% since the start of this week as the coronavirus has spread around the world, threatening an extended period of disruption to international travel.
The International Monetary Fund will send another mission to Argentina to continue debt strategy talks and discuss “next steps,” an IMF spokesman said on Thursday, as the South American nation seeks to renegotiate its $57 billion financing package, Reuters reported. The IMF technical team will arrive in Buenos Aires next week for meetings with economy ministry officials about the government’s economic program, the spokesman said. The fund’s last mission to Argentina ended just over a week ago.
The first coronavirus case in Latin America sent currencies tumbling across the region Thursday as investors became increasingly risk averse, Bloomberg News reported. All Latin American currencies were among the worst performers in emerging markets, with Brazil’s real reaching an all-time low despite the central bank intervention and the Mexican peso dropping to the weakest since early December. Both the Colombian and Chilean pesos were on track to reach their all-time lows.
European debt markets are reeling from the perfect storm of risk aversion as the coronavirus crisis threatens to rapidly become a pandemic, Bloomberg News reported. Investors are dumping anything seen as risky and piling into top-rated government bonds -- especially those of Germany -- for safety, while boosting bets for emergency monetary easing by the European Central Bank. Yield premiums on peripheral euro-area bonds jumped this week as Italy reported the region’s biggest surge in infections, reigniting fears of a recession in the country.
Central banks are paying attention to climate-related financial risks. They are beginning to incorporate them into their financial stability and economic analysis, and in stress tests for banks, the Financial Times reported. It is also time for central banks to consider such risks when implementing monetary policy. This will be challenging. It requires more data relevant to the assessment of the climate change threat, a thorough methodology and, importantly, time.
An embattled Chinese property developer has sparked concern about a potential default on a dollar bond, after offering investors a swap for cash and new bonds for the bulk of the $300 million note, Bloomberg News reported. Yida China Holdings Ltd., a business park developer, proposed an exchange for at least 75% of the bond due April, saying its existing internal resources “may be insufficient to repay” the note, according to a company filing to the Hong Kong Stock Exchange.
Homebase plans to end its company voluntary arrangement 18 months early after the UK’s second-largest home improvement retailer renegotiated most of its leases and improved profitability, the Financial Times reported. The group used the controversial insolvency procedure in 2018 to cut rents and close stores after a brief but disastrous period of ownership by Australian group Wesfarmers. CVAs give struggling businesses a chance to renegotiate debts with creditors. For Homebase the process had been due to run until August 2021 but will instead terminate in March or April.
Billionaire John Fredriksen’s heavily indebted Seadrill Ltd. said it’s continuing talks with its banks as it reported a new loss amid a sluggish recovery in offshore drilling, Bloomberg News reported. The rig operator is under pressure less than two years after completing a massive restructuring that left it with almost $6 billion in bank debt. The company had counted on a strong market recovery that has yet to fully materialize as repayments come closer. Seadrill said the pace of the recovery has even slowed so far in 2020, as it reported a net loss of $199 million.
Hontop Energy (Singapore) Pte Ltd, the trading arm of a Shandong-based refiner, has gone into receivership, according to its business profile on the website of Singapore’s accounting and corporate regulator, Reuters reported. Singapore bank DBS, one of Hontop’s creditors, has appointed accounting firm KPMG as the receiver, a KPMG official told Reuters. DBS declined to comment. “Hontop continues to be run by the existing management. The receiver has been appointed over specific charged assets which mainly relate to one trade transaction financed by DBS.
Resources by Country & Region
The recently adopted Directive on restructuring and insolvency (the ‘Directive’) seems to indicate that IT might help running proceedings more efficiently. For example, in connection with the selection of practitioners, the Directive’s Recital 88 reads:
“Member States should not be prevented from providing for a practitioner to be selected by other methods, such as random selection by a software programme, provided that it is ensured that in using those methods due consideration is given to the practitioner's experience and expertise.”
Belarus: New draft laws on insolvency. The Government of the Republic of Belarus has submitted a new draft law on insolvency to the Parliament. The Resolution No.9 of the Ministry of Economy ‘On electronic bidding for the sale of property in economic insolvency (bankruptcy) proceedings” will come into force on 13 November 2019.
Associations for creditor protection are a central component of the Austrian insolvency landscape. As “privileged associations for creditor protection” legally anchored and equipped with so-called “preferential rights”, they are an inseparable part of all insolvency proceedings conducted in Austria, providing services to creditors, insolvency practitioners and insolvency courts alike.
The acquisition of production units (PU), defined by article 149.4 of the Insolvency Act 22/2003 (IA) as “a set of means organised for the purpose of carrying out an essential or ancillary economic activity”1, can be structured in each of the phases of the Spanish insolvency procedure, i.e.: (i) common phase, (ii) composition phase, (iii) liquidation phase, and (iv) pre-pack process; each of them with the specificities analyzed below
Demystifying offshore: recognition and assistance in overseas territories by Stephen Alexander, Nicholas Fox, Justine Lau and Abel Lyall
In a global financial environment, insolvency office-holders will often need to look beyond their home jurisdictions in order to undertake their principal function of getting in and realising assets.
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: