Headlines

The Parliament on Monday passed a bill that temporarily suspends initiation of corporate insolvency resolution process under the IBC, for a period not exceeding one year from March 25, to provide relief to companies affected by COVID-19 to recover from the financial stress, Big News Network.com reported. The Lok Sabha passed the Insolvency and Bankruptcy Code (Second Amendment) Bill 2020 after a reply by Finance and Corporate Affairs Minister Nirmala Sitharaman. The bill had earlier been passed by the Rajya Sabha and will replace an ordinance brought by the government.

The head of Indonesia’s flag carrier said better terms on aircraft loans will help it avoid falling into bankruptcy as the nation grapples with surging coronavirus cases, Bloomberg News reported. “We discussed the risks, the benefits, the pluses and minuses and the company’s leadership decided against it,” PT Garuda Indonesia President Director Irfan Setiaputra said when asked in a Sept. 18 interview about considering bankruptcy proceedings.

The district court of Amsterdam on September 18, 2020 under a claim of Sberbank of Russia against DTEK Energy B.V. ordered to pay around $45.1 million and to take interim measures in respect of certain assets of DTEK Energy B.V. in the Netherlands, The Interfax-Ukraine News Agency reported. DTEK Energy said that these actions have no impact on the company's day-to-day operations of coal mining and electricity generation, the company is in dialogue with creditors on terms of the long-term loan restructuring.

A group of Venezuela creditors is launching a new fund focused on distressed debt. The Canaima Global Opportunities Fund, named after a Venezuelan national park, will focus on defaulted, U.S.-sanctioned notes from the South American country, said Celestino, Bloomberg News reported. Amore, the managing director of IlliquidX, a London-based distressed-debt brokerage firm that will advise the fund. Amore said they intend to reach out to Venezuelan authorities “immediately” to discuss an accord with bondholders.

European banks have loaded up on more than €200bn of their own governments’ bonds since the start of the Covid-19 pandemic, in a move that could reawaken fears about the sector’s growing stockpiles of risky sovereign debt, the Financial Times reported. According to research by S&P Global Ratings, banks had increased their holdings of home-country government bonds to nearly €1.6tn by the end of June, up 15 per cent from the end of February. The rating agency said the pace of purchases was seven times faster than in the same period in 2019.

Foreign investors are unlikely to rush back into Indonesian markets until either it pays more for its debt or gives hard evidence it will not push the central bank into longer-term monetary financing of public borrowing, fund managers say, Reuters reported. External demand for government debt in Southeast Asia’s largest economy, normally prized for 7% yields that are increasingly rare even in the world’s emerging markets, has slumped since March with foreign holdings hitting a decade-low in August.

Argentina’s new dollar bonds have plunged back into distressed territory just two weeks after the nation restructured almost $65 billion in debt. The securities fell for the fourth consecutive day Monday to an average 39 cents on the dollar, Bloomberg News reported. The $16.1 billion in bonds maturing 2030 tumbled 3.1 cents to 40.3 cents, the lowest since they began trading on Sept. 8 at about 50 cents. The bonds have a spread of around 1,300 basis points over U.S. Treasuries, well above the 1,000 points many investors consider to be the threshold for debt to be classified as distressed.

Never put off till tomorrow what you can do today is good advice for procrastinators and those in a pickle. Rolls-Royce is undoubtedly in a pickle, the Financial Times reported. And it has arguably been putting off an inevitable equity raise for months. But the situation facing the aerospace engineering group, which confirmed on Monday that it was evaluating a cash call of up to £2.5bn, is nuanced and not as straightforward as its weakened share price implies. It was always really a question of when, not if, with Rolls’ equity issue.

Chad has asked Glencore Plc to suspend payments on its oil-for-cash loan this year, a move that could prove a precedent for private creditors worried about being dragged into a global debt-relief push for poor countries, Bloomberg News reported. After securing a $61 million debt waiver in June, sponsored by the Group of 20, the central African nation sent a letter to the world’s biggest commodity trader and other private lenders, asking them to allow debt freezes, according to two people familiar with the matter.

Norway's government has extended loan guarantees for the country's airlines, including Norwegian Air, by two months until the end of 2020, the Industry Ministry said on Sunday, Reuters reported. Norwegian Air secured a state aid package of 3 billion Norwegian crowns ($330 million) earlier this year after a debt restructuring but said last month it needed to secure more funding to get through the COVID-19 pandemic. The government has changed the terms of the state guarantee scheme, the industry ministry said in a statement, without disclosing specifics.