Japan Airlines Co. posted its biggest quarterly net loss in at least eight years and decided to forgo paying an interim dividend as it contends with the devastating impact of the coronavirus, Bloomberg News reported. The carrier’s first-quarter loss was 93.7 billion yen ($890 million), the most since it re-listed on the Tokyo stock exchange in 2012 after emerging from bankruptcy. Since then, it only posted one other quarterly loss; in January-March of this year. The Covid-19 outbreak has damaged the aviation industry globally and forced airlines into unprecedented cutbacks.
Indonesia’s flag carrier needs cash fast as losses soar past a half-billion dollars and unpaid bills pile up, yet negotiations for government aid move slowly and still may not yield enough to cover the shortfall, Bloomberg News reported. A first-half loss of $713 million, announced last week, was just the latest piece of bad news for PT Garuda Indonesia. The airline already missed a payment on an asset-backed security in late July, shortly after extending the repayment of a $500 million sukuk -- an Islamic bond -- by three years because of its cash crunch.
The saga of Singapore’s highest profile restructuring case, Hyflux Ltd., looks set to run a bit longer, Bloomberg News reported. United Arab Emirates-based suitor Utico FZC agreed to extend a binding offer until Aug. 30, according to a filing. Utico has been pursuing Hyflux since last year, and had previously said the binding offer it made last month was open for acceptance until July 31. Hyflux was once a high-flier that stumbled after an ill-timed foray into the energy business that eventually led to it starting a court-supervised process in 2018.
Societe Generale SA is closing its trade commodity finance unit in Singapore after the collapse of Hin Leong Trading (Pte) Ltd. prompted the bank to halt fresh funding to such firms in the region, Bloomberg News reported. The bank is dismissing all front office staff dealing with transactions, while still keeping some administrative workers, people with knowledge of the matter said, asking not to be named because the matter is private. Large Asian commodities trading clients with operations in Singapore will now be handled by Hong Kong, the people said.
Japan is trying to both contain a resurgence of the coronavirus outbreak and support the economy, especially the tourism sector, according to Chief Cabinet Secretary Yoshihide Suga, Bloomberg News reported. Striking a balance is “extremely difficult,” Suga said Sunday on public broadcaster NHK, adding the government is helping businesses avoid bankruptcies through virus relief measures such as special loan programs. The government will maintain a travel campaign that excludes Tokyo to support domestic tourism, a key growth driver for regional economies, he added.
Emerging-market stocks and currencies are within touching distance of erasing their pandemic-fueled losses of 2020, Bloomberg News reported. Too bad the virus is still running riot, economies are shrinking and central banks are getting low on firepower. In fact, the backdrop is so grim that investors may soon start to take the view that prices are starting to defy gravity. After falling more than 30% by March, developing-nation stocks as measured by MSCI Inc.’s benchmark index are just 3% below the level at which they started the year.
Religare Finvest, which is the NBFC arm of embattled financial services conglomerate Religare Enterprises Ltd (REL), is hopeful of completing its debt restructuring by December this year, The Hindu Business Line reported. “We don’t expect the final restructuring plan to go beyond the third quarter of the year, maybe even earlier than December,” said Nitin Aggarwal, Group CFO, Religare Enterprises Ltd and CEO, Religare Broking, adding that once it is through, the company will be much different.
High-grade eurozone government debt yields dropped to their lowest levels in over two months as a cocktail of negative news sent investors scrambling for safe assets, Reuters reported. Poor corporate earnings, record deaths from COVID-19 in six U.S. states and frictions over a stimulus plan in the United States hit risk sentiment on Wednesday, and had investors retreating to safe assets such as government bonds. Fears of rising COVID-19 infections also hit Asia and Europe this week, with several countries imposing new restrictions and Britain quarantining travellers from Spain.
Bank of Japan Deputy Governor Masayoshi Amamiya said the central bank will not rule out deepening negative interest rates as part of efforts to cushion the economic blow from the coronavirus pandemic, Reuters reported. But he said the BOJ must be vigilant to the cost of any such steps, warning that excessively low rates could hurt financial institutions’ profits and discourage them from lending. “When considering additional easing steps, we must be mindful than ever before of their potential side-effects,” Amamiya told a news conference on Wednesday.
The family that owns beleaguered Singaporean oil trader Hin Leong Trading (HLT) is seeking to block a request from creditor OCBC that overseers be appointed for Xihe Holdings and four of the family’s other subsidiaries to recoup its debt, Reuters reported. Oversea Chinese Banking Corp (OCBC) applied last week for the Singapore High Court to appoint judicial managers over Xihe, owned by the family of Hin Leong founder Lim Oon Kuin, known as O.K. Lim.