A group of Turkish banks hired Morgan Stanley as financial adviser to sell their 55% stake in the country’s largest phone company, Turk Telekomunikasyon AS, Bloomberg News reported. The carrier’s shares rose more than 4%. The three banks -- Turkiye Is Bankasi AS, Akbank TAS and Turkiye Garanti Bankasi AS -- took control of Turk Telekom in December, setting it up for a likely sale after previous owner Otas defaulted on a multi-billion-dollar loan.
Troubled Japanese automotive supplier Akebono Brake Industry said Wednesday it has reached a deal with creditors to wipe away 56 billion yen ($518 million) in debt as part of a restructuring that will dispose of six factories, Nikkei Asian Review reported. The sum represents half of Akebono's bank debt and helps pave the way for a turnaround for the supplier to General Motors, Toyota Motor and Nissan Motor. Banks agreed to the loan forgiveness as well as the turnaround plan during a creditors meeting held Wednesday in Tokyo.
China’s banks are racing to issue domestic perpetual bonds as they seek to top up capital levels to meet tighter regulations, with about Rmb810bn ($114bn) worth of debt issued or in the pipeline, the Financial Times reported. The embrace of “perps” — bonds with no maturity date, which qualify as loss-absorbing capital — is part of an effort by Beijing to shore up the nation’s financial system as the economy loses steam, and after a crackdown on the “shadow” banking sector, in which many banks had invested, put several under stress.
The introduction of GST has been described as India’s biggest tax reform, and the Insolvency and Bankruptcy Code (IBC) is a landmark contemporary law that has just begun to be assessed for efficacy, The Financial Express reported. While GST subsumed various indirect tax payments into one, reducing the compliance burden on the taxpayers, IBC reduced the number of days needed to liquidate a company. IBC is also expected to resolve the prevailing non-performing asset crisis, which would positively impact availability of bank credit in the long term.
The National Company Law Tribunal (NCLT) has initiated corporate insolvency resolution process against Sana Realtors under Section 7 of the Insolvency and Bankruptcy Code 2016, ETRealty reported. The court has appointed Sudhir Kumar Agarwal as the interim resolution professional (IRP) for the case. The court directed the IRP to make public announcement. The buyer had booked four apartments in Sana Realtors' Precision Soho Towers, situated in Sector 67, Gurugram in August 2010 for Rs 48.30 lakh.
Turkey took its boldest step yet to clean up the growing pile of bad debt held by banks, Bloomberg News reported. The Banking Regulation and Supervision Agency, or BDDK, told lenders for the first time to reclassify 46 billion liras ($8.1 billion) of loans as non-performing by the end of the year and set aside enough provisions to cover them, it said in a statement late Tuesday. The reclassification of the loans, mostly to construction and energy firms, will bring the industry’s non-performing loan ratio to 6.3% this year, slightly higher than the watchdog’s December prediction of 6%.
One of India’s top shadow financiers by assets is betting that central bank easing will bring an end to the nation’s prolonged credit crisis, even as fresh strains in the sector emerged this week, Bloomberg News reported. “Interest-rate cuts and infusion of liquidity by the RBI will give a boost to the bond markets and aid the credit market to return to normalcy by December,” Rashesh Shah, chairman of Edelweiss Financial Services Ltd., said in an interview from the company’s steel-and-glass headquarters in Mumbai.
A plan to rescue India’s debt-laden Dewan Housing Finance Corporation Ltd (DHFL) has hit a major roadblock as only a small segment of bondholders has agreed to be on board the proposed resolution, according to a custodian of DHFL bonds, Reuters reported. The process has been further complicated as certain bondholders have also initiated a process to take DHFL to bankruptcy court, the custodian added.
China's factory gate prices shrank for the first time in three years in July, stoking deflation worries and adding pressure on Beijing to deliver more stimulus as the economy sputters amid an intensifying trade war with the United States, the International New York Times reported on a Reuters story. With demand slowing at home and abroad, Chinese manufacturers are having to cut prices to keep market share, depressing profit margins and discouraging the fresh investment needed to get the economy back on its feet.
India’s fragile financial system is swinging between despair and hope. Two separate incidents — both featuring the lender Yes Bank Ltd. — recently underscored the drag of past underwriting follies as well as the lift from a digital reset, a Bloomberg View reported. It will take time, but good things will come to Indian banking as a result of the present crisis. Start with the sudden default by financier Altico Capital India Ltd. on a 199.7-million-rupee ($2.8-million) interest payment to Dubai-based Mashreqbank PSC.
