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Net losses at airline Avianca Holdings increased 22% to $1.09 billion in 2020, due to the near-paralysis of global air travel because of COVID-19, Reuters reported. The airline, which is carrying out a restructuring process under the chapter 11 bankruptcy law, had losses of $894 million in 2019. Operations contracted 74% year-on-year, the airline said in a filing to Colombia’s financial regulator, while operating income was down to $1.71 billion, from $4.62 billion in 2019.
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Three months after Britain exited the EU, London on Friday reached a cooperation agreement on financial services with Brussels but despite this first step rivalries between the two sides remain, AFP reported. The memorandum of understanding, which is still to be signed, will "create the framework for voluntary regulatory cooperation" and establish a regulatory forum which will "serve as a platform to facilitate dialogue on financial services issues", Britain's finance ministry said.
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Nomura and Credit Suisse warned on Monday they were facing big losses after a U.S. hedge fund, named by sources as Archegos Capital, defaulted on margin calls, putting investors on edge about who else had been caught out, Reuters reported. Losses at Archegos Capital Management, run by former Tiger Asia manager Bill Hwang, had triggered a fire sale of stocks on Friday. Nomura said it faced a possible $2 billion loss due to transactions with a U.S.
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At a hearing that began at 5 p.m. on March 1, lawyers for Greensill Capital desperately argued before a judge in Sydney, Australia, that the firm’s insurers should be ordered to extend policies set to expire at midnight. Greensill Capital needed the insurance to back $4.6 billion it was owed by businesses around the world, and without it 50,000 jobs would be in jeopardy, they said. The judge said no; the company had waited too long to bring the matter to court. A week later, Greensill Capital — valued at $3.5 billion less than two years ago — filed for bankruptcy in London.
Tycoon Sanjeev Gupta’s Liberty Steel UK plans to restart steelmaking next week and continues to seek new funding after its main financial backer Greensill Capital went into insolvency, it said on Monday, Reuters reported. Gupta’s conglomerate GFG Alliance said earlier this month it was in talks with administrators of Greensill over a standstill agreement. On Monday GFG said those negotiations were ongoing and also said that Liberty Steel was still seeking support from the UK government.
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Chinese lending to African governments dropped by nearly a third in 2019 -- and probably continued to fall last year -- as a rising threat of defaults stemmed a deluge of credit from the country in the past decade, Bloomberg News reported. A study by Johns Hopkins University’s China-Africa Research Initiative showed that Chinese financing to Africa fell below $9 billion for the first time in nearly a decade in 2019, with Beijing refraining or reducing the size of loans to major borrowers such as Angola and Ethiopia.
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Visa Inc. said yesterday that it will allow the use of the cryptocurrency USD Coin to settle transactions on its payment network, the latest sign of growing acceptance of digital currencies by the mainstream financial industry, Reuters reported. Visa has launched the pilot program with payment and crypto platform Crypto.com and plans to offer the option to more partners later this year, it said. The USD Coin (USDC) is a stablecoin cryptocurrency whose value is pegged directly to the U.S. dollar.
The giant cargo carrier blocking the Suez Canal was finally on the move Monday afternoon, nearly a week after it wedged sideways, causing billions of dollars worth of damage to global trade, the Washington Post reported. A fleet of tugboats worked through the night to take advantage of a full moon that led to the highest tide all month, helping to lift the boat. As of Monday morning, the Ever Given had been 80 percent refloated, the Suez Canal Authority said in a statement.
India allowed the resumption of bankruptcy filings, ending a year-old suspension created to protect firms from the impact of the virus pandemic, Bloomberg News reported. The law is in operation after an executive order halting bankruptcy proceedings expired on March 25, said the people, asking not to be identified as the matter is not public. The move follows a court ruling earlier this week that mandated banks to resume classifying bad debt, unwinding another pandemic-era measure.
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Authorities in India believe that a new breed of lender, its technique sharpened in China, has been preying on working-class and rural people who have been devastated by the impact of the coronavirus on the Indian economy, the New York Times reported. These lenders don’t require credit scores or visits to a bank. But they charge high costs over a brief period. They also require access to a borrower’s phone, siphoning up contacts, photos, text messages, even battery percentage.
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