Asia

China’s biggest developers are borrowing record amounts in Hong Kong, taking advantage of lower interest rates to circumvent a lending crackdown at home, Bloomberg reported. While banks demand at least 5.2 percent in annual interest for three-to-five year money in mainland China, the cost of credit in Hong Kong dollars has fallen to the least since November 2004, according to data compiled by Bloomberg. China Overseas Land & Investment Ltd. agreed to an HK$8 billion ($1.03 billion) loan in February that pays 1.45 percent at current market levels, the data show.
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The sell-off in global markets has accelerated amid fears that the eurozone debt crisis would worsen and that China’s recovery is faltering, the Financial Times reported. From Hong Kong to New York, there was mounting concern that the €110bn international rescue package for Greece would not prevent the crisis spreading from Athens to other highly indebted eurozone nations. The euro dropped to a one-year low against the dollar, European shares plumbed two-month lows and the bond markets of weaker eurozone economies fell as rattled investors sold risky assets.
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Dubai International Capital Wednesday sent a letter to senior lenders of German aluminum company Almatis, urging them to vote against a restructuring plan from distressed-debt investor Oaktree Capital, Dow Jones Daily Bankruptcy Review reported. The letter comes on the eve of Almatis' management filing to place the company in U.S. Chapter 11 bankruptcy proceedings as part of Oaktree's restructuring plan to more than halve Almatis' $1 billion debt to around $422 million.
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Creditors of Daewoo Motor Sales Corp. Tuesday stepped in to keep the vehicle sales and real estate development company afloat reversing an earlier decision to let it go bankrupt after failing to pay back maturing debts, but the decision appears to be a stopgap measure, Dow Jones Daily Bankruptcy Review reported. Tuesday morning creditors paid a combined KRW26.8 billion ($24 million) that was due on Friday and Monday, giving Daewoo Motor Sales a lifeline, main creditor Korea Development Bank said. "But we cannot guarantee payment of additional debts that mature from May.
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Struggling Japan Airlines is to cut 45 more international and domestic routes this financial year as it accelerates its plan to return to profitability, it said Wednesday. The airline, being restructured with the help of a state-backed turnaround fund after filing for bankruptcy in January, will slash international and domestic capacity by 40 percent and 30 percent respectively, compared to fiscal 2008, Agence France-Presse reported.
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China's real estate rush, once confined to a handful of leading cities, has spilled into the hinterlands with a ferocity reminiscent of American expansion into exurbs like the Inland Empire, the Los Angeles Times reported. "The situation in Hefei is a symbol of the craziness in China's real estate market," said Cao Jianhai, a professor of economics at the Chinese Academy of Social Sciences, a government think tank. "Prices in second- and third-tier cities are increasing more dramatically than in the first tier.
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Debt-ridden Japan Airlines Corp (JAL) could miss its June-end deadline for submitting a rehabilitation plan by as much as two months as it deals with local governments opposed to flight cuts, the Nikkei said. The struggling airline's main lenders have said they will not recommence lending unless the company drastically revamps unprofitable flight operations in the restructuring plans to be drawn up by the end of June.
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Creditors of Daewoo Motor Sales Corp. have decided to let the vehicle sales and real estate development company go bankrupt, the main creditor, Korea Development Bank, said Monday. "The debt-rescheduling program for Daewoo Motor Sales may run aground due to the creditors' bankruptcy decision," a KDB official told Dow Jones. The company may be placed under a court receivership, said the official, who asked not to be identified. Daewoo Motor Sales said if it comes under the court protection, it is "the worst-case scenario" they can imagine.
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Taiwan's Financial Supervisory Commission said Friday it extended the receivership of Kuo Hua Life Insurance Co. by another nine months to allow investors to bid for the firm, Taiwan's first life insurance company to be taken into receivership by the government for more than 40 years, Nasdaq.com reported on a Dow Jones story. The receivership period was to end May 3. The Financial Supervisory Commission took over Kuo Hua Life Aug. 4, 2009, because it had more debt than assets, and handed it over to the Taiwan Insurance Guarantee Fund, which is funded by a tax from industry premiums.
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Lehman Brothers Holdings Inc.'s bankruptcy estate sued three arms of Japanese investment bank Nomura Holdings Inc. in an attempt to wipe out more than $1 billion of claims related to derivatives contracts, Dow Jones Daily Bankruptcy Review reported. Lehman filed legal complaints Friday against Nomura International PLC in London, Nomura Global Financial Products in New York and Nomura Securities Co. Ltd. in Tokyo, seeking to invalidate large claims the companies made against the investment bank after it had filed for bankruptcy. In each complaint, filed in the U.S.
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