India may need to inject up to 1.5 trillion rupees ($19.81 billion) into its state-owned lenders as their pile of soured assets is expected to double during the coronavirus pandemic, three government and banking sources told Reuters, Reuters reported. The government initially considered a budget of around 250 billion rupees for bank recapitalisations but that has risen significantly, a senior government source with direct knowledge of the matter said, with loan defaults likely to rise as businesses take a severe hit from nationwide lockdowns to tackle the coronavirus.
Struggling companies across Europe including Matalan, Travelodge and Heathrow airport have tapped their banks for €32bn of funds to help stay afloat through turbulence caused by coronavirus lockdowns, the Financial Times reported. Over the past four months, at least 104 companies that rank below investment grade have drawn down roughly €32.2bn from their loan facilities from global banks, according to data from 9Fin, a fintech data provider that has scraped the filings of European bond issuers. The true figure is likely to be much higher, given that publicly traded companies are n
Zambian president Edgar Lungu’s government has hired Lazard to advise on restructuring the cash-strapped southern African nation’s $11bn foreign debts that have threatened to become Africa’s first sovereign default during the coronavirus pandemic, the Financial Times reported. The investment bank was hired on a $5m contract to advise on “liability management” of the country’s debt after a tender process, the Zambian ministry of finance said on Wednesday.
Sri Lanka’s finances were fragile long before the coronavirus delivered its blow, but unless the country can secure aid from allies like China, economists say it may have to make a fresh appeal to the IMF or default on its debt, Reuters reported. All the tell-tale crisis signs are there: a tumbling currency, credit rating downgrades, bonds at half their face value, debt-to-GDP levels above 90% and almost 70% of government revenues being spent on interest payments alone.
South Korean bank stocks have gone from cheap to extremely cheap in a matter of months as concerns grow over their loan books tied to the nation’s flagging property sector, Bloomberg News reported. The MSCI Korea Financials Index, in which banks carry a 65% weighting, is trading at 0.34 times its members’ book value, down from about 0.5 times at the end of 2019, according to Bloomberg-compiled data.
Russia’s retail sales plunged the most since records began in the latest sign that the government’s cautious stimulus program has done little to soften the economic blow from the coronavirus lockdown, Bloomberg News reported. Retail sales fell 23% in April, compared with the same period a year ago, Russia’s statistics agency said on Tuesday. The median estimate in a Bloomberg survey had forecast an 18% drop.
Thai Airways International Pcl on Wednesday said it appointed board members as rehabilitation planners in a bankruptcy court submission, Reuters reported. The court accepted the airline’s request for bankruptcy protection earlier in the day, setting the first hearing for August 17. It gave creditors until three days before then to submit objections. The rehabilitation committee comprises the flagship carrier’s chairman Chaiyapruk Didyasarin, acting president Chakkrit Parapuntakul and three newly appointed board members, including its former CEO, Piyasvasti Amranand.
Prime Minister Shinzo Abe doubled Japan’s stimulus measures as he looked to deliver on his bold promise to keep businesses and households afloat with the world’s biggest virus-response package, Bloomberg News reported. His cabinet approved Wednesday a 117 trillion yen ($1.1 trillion) set of measures that includes financing help for struggling companies, subsidies to help firms pay rent and several trillion yen for health care assistance and support for local economies.
Argentina’s former nemesis Paul Singer is standing judgment over the nation’s bond market once more, Bloomberg News reported. Four years after cutting a deal with the hedge fund billionaire to end a lengthy legal dispute over its defaulted debt, the South American country can’t pay its debts again and Singer is back for a brief encore. His investment firm Elliott Management Corp. is one of 14 companies that will decide whether credit-default swaps were triggered by last week’s failure to meet a payment deadline.
South African Airways (SAA) can still be saved if it gets the necessary funding, the state-owned airline’s administrators said on Wednesday, adding they were talking to the government about a potential restructuring, Reuters reported. The comments in a letter to affected parties seen by Reuters mark a shift in tone from a recent appearance before a parliamentary committee, when the administrators said a wind-down of the business was a probable outcome.