Finland

Finland’s rapid recovery from the economic crisis caused by the coronavirus looks unlikely, but the worst-case scenarios have so far been avoided, Bank of Finland governor Olli Rehn said on Tuesday, Reuters reported. The bank believes Finland’s gross domestic product will contract around 7% this year and grow around 3% in 2021 and 2022, but said GDP contraction could be as little as 5% or as much as 11% in 2020 in alternative scenarios. “Finland has not experienced a sizeable wave of bankruptcies.

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Finland’s Stockmann suffered a 49.1% fall in March sales hurt by the impact of the coronavirus, said the department store operator, which has filed for corporate restructuring, Reuters reported. Its adjusted operating loss widened to 30.5 million euros from 21.4 million a year earlier, it said. Shares in the company were down 4.2% by 0900 GMT. Known for its upmarket department stores, Stockmann has struggled for years in the face of a consumer shift to online shopping, prompting cost cuts and divestments. On April 6, Stockmann announced it would file for corporate restructuring.

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Finnish department store owner Stockmann has decided to file for a corporate restructuring after the drop in customer volumes caused by the coronavirus outbreak, it said on Monday, sending shares in the company down 32%, Reuters reported. Stockmann said its main creditors had given a positive initial response to the move, which is a form of administration in which a court appointee is charged with restructuring the company to avoid bankruptcy.

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The Finnish government will on Thursday give the green light for Terrafame to start mining and refining uranium at an existing mine in eastern Finland, a government source told Reuters on Wednesday, Reuters reported. The permit will allow Terrafame, which is majority state-owned, to become the first miner to extract uranium on a commercial scale in Finland. Terrafame took over the nickel mine, previously known as Talvivaara, in the Kainuu region back in 2015, after environmental hurdles had led it to file for bankruptcy.

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Swedish oil refiner Nynas, which is owned by Venezuela’s state-run PDVSA and Finland’s Neste Oil, said on Tuesday it planned to reorganize its business in an attempt to disentangle itself from U.S. sanctions imposed on Venezuela, Reuters reported. Nynas said the proposed changes to its ownership structure, backed by both PDVSA and Neste Oil, were filed with the United States’ Office of Foreign Assets Control (OFAC) on January 17.

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Investors have poured more than $10bn into junk bond funds since early June, highlighting the intensity of their hunt for yield amid a big rally in the bond market. Net inflows into the asset class registered $2.3bn in the week to Wednesday, according to EPFR data, the Financial Times reported. That brought the boost over the past five weeks to $10.6bn, the largest increase over any such period since 2017.

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The two biggest banks in the Nordic region saw their market values shrink on Tuesday after publishing first-quarter results that disappointed investors, Bloomberg News reported. Danske Bank A/S said it now expects net interest income to be lower this year than in 2018 as the higher cost of funding brought on by its money-laundering scandal erodes its top line. Its shares plunged more than 7 percent after the market opened in Copenhagen. At Nordea Bank Abp, net interest income missed market expectations amid growing pressure from its biggest investors to boost revenue.

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A total of 10 former employees of Danske Bank A/S in Estonia were apprehended over the course of Tuesday and Wednesday, Bloomberg News reported. Estonian prosecutors suspect they deliberately helped criminals from the former Soviet Union launder money, for personal gain. In Denmark, where Danske is the biggest bank, the government made clear it’s not in favor of clemency. “It’s very important to come down hard on this case,” Danish Business Minister Rasmus Jarlov told Bloomberg.

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Finland’s Ahtium Oyj, previously named Talvivaara Mining Company, which ran a troubled nickel mine in northern Finland, has filed for bankruptcy after failing to secure financing for future projects, it said on Tuesday, Reuters reported. Ahtium is the former owner of the mine that leaked waste water in 2012 and faced serious production problems, prompting the Finnish government to take control of the mine in 2015 in an effort to protect local jobs and the environment.
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Finland’s economy suffered its worst performance in five years in the second quarter of the year, falling into contraction for the first time since the depth of its woes back in 2012. A measure of adjusted year on year GDP fell 0.5 per cent in the three months to June, down from growth of 2.5 per cent at the start of the year, according to Statistics Finland. Outside the southern European member states, Finland has been one of the worst performing economies in the single currency area over the last decade.
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