Asia

Beleaguered Indian shadow lender Dewan Housing Finance Corp. posted its first quarterly loss in more than a decade, missed interest payments and cast doubt on its ability to continue as a going concern, Bloomberg News reported. DHFL posted a loss of 22.23 billion rupees ($324 million) for the quarter ended March compared with 1.34 billion in net income a year ago, it said in a stock-exchange filing. That would be its first loss in data going back to June 2008. The financier also said in a separate filing that it missed interest payments amounting to 480 million rupees due last week.

Read more

Risky borrowers are running into trouble in China and that is putting pressure on trust companies, an important corner of the country’s shadow-banking system, The Wall Street Journal reported. The fear is that this could further reduce the credit available for private businesses, acting as a drag on an economy whose growth is already slowing. Lightly regulated trust companies have been critical lenders for these firms, as traditional banks deal mostly with favored state-owned enterprises. These problems could also bounce back on many small investors.

Read more

Jet Airways shut down its operations on April 17 following the refusal by its lenders to advance any funds for its operations, The News Minute reported. Subsequently, State Bank of India filed an application with the National Company Law Tribunal (NCLT) to initiate insolvency proceedings against the airline company. News has now come in that Etihad Airways has expressed its interest in the resolution of the Jet Airways imbroglio.

Read more

India’s battle against the world’s worst bad-loan ratio is being stalled by some unforeseen parties: regulators and federal investigators, Bloomberg News reported. A spate of legal challenges mounted by the country’s markets regulator, anti-money-laundering agency and its tax department accentuate conflicts between bankruptcy law and other regulations that pre-date them. In many cases, the court battles being fought by these agencies to hang on to powers to seize and sell assets of those violating their rules are derailing a 270-day resolution deadline set by the insolvency law.

Read more

Indian tycoon Anil Ambani plans to raise about 217 billion rupees ($3.2 billion) by selling assets from roads to radio stations in a bid to cut debt…Ambani is waging a war on debt. He said on June 11 that his Reliance Group repaid 350 billion rupees in the past 14 months through asset disposals, Bloomberg News reported. But a large pile remains. The four biggest group companies still have about 939 billion rupees of debt. And that excludes Reliance Communications Ltd., Ambani’s former flagship firm, that recently slipped into insolvency.

Read more

Before being detained by police in Shanghai, Lo Ching was lauded as the new-age Hua Mulan, the legendary female Chinese warrior. Now the downfall of Lo, chairman of a Hong Kong-listed conglomerate, has become a parable of the dangers of investing in China, a Bloomberg View reported. Noah Holdings Ltd., one of China’s largest wealth managers catering to high-net-worth individuals, is among the first to find out. The U.S.-listed asset manager has filed a lawsuit against Camsing International Holding Ltd.

Read more

Indian car sales fell by nearly a quarter last month — marking one of the industry’s worst slumps in more than a decade — as a credit crunch squeezes consumption across the country, the Financial Times reported. Car sales of 139,628 for June were down 24 per cent on the same period last year, according to the Society of Indian Automobile Manufacturers, extending a run of three months of declines of 20 per cent or more. Sales fell 26 per cent in May. At the heart of the pain is a liquidity squeeze whose effect has started to show up in India’s industrial and economic data.

Read more

Banking officials are warning Cypriot authorities to not dilute legislation aimed at helping banks on the east Mediterranean island nation from getting to grips with their huge bad loan problem, the International New York Times reported on an Associated Press story. A source familiar with the situation, who isn't authorized to speak publicly, said Wednesday that proposed amendments "point in the direction" of some watering down to the recently passed legislation that has enabled banks reduce their bad loans.

Read more

Freightco India Ltd. moved the National Company Law Tribunal to initiate insolvency proceedings against Jain Farm Fresh Foods Ltd.—a subsidiary of debt-laden Jain Irrigation Systems Ltd.—for not paying dues, BloombergQuint reported. Jain Farm Fresh, nearly 82 percent of which is owned by Ashok Jain and family-controlled Jain Irrigation, had reported a revenue worth Rs 1,632.94 crore as of March 2018 and suffered a loss of Rs 43.53 crore, according to disclosures made in the parent’s annual report.

Read more

In a related story, Moneycontrol reported that the discourse over cross border or international insolvency framework has significantly gained traction with the turmoil at Jet Airways. Any airline having international operations will naturally have assets and businesses in multiple jurisdictions. If it goes bankrupt, then questions pertaining to the relevant country will naturally arise.

Read more