Headlines

A Colombian court temporarily blocked a $370 million government loan to Avianca Holdings SA after a citizen expressed concern about a lack of guarantees, Bloomberg News reported. The Cundinamarca Administrative Tribunal granted an injunction to suspend disbursement after a motion filed by a citizen against the Finance Ministry, the presidency and the airline said the loan, part of its debtor-in-possession financing, may become a “threat” to collective rights and public worth, according to a copy of the ruling sent by court.

Around half a million jobs are likely to be lost in the UK this autumn, far higher than job losses at the peak of the last downturn, a new analysis of recent dismissal notifications shows, the Financial Times reported. Figures obtained from government show that companies notified the Insolvency Service of around 380,000 staff at risk of dismissal between May and July, according to the Institute for Employment Studies, a research group. Most of these came in the latter two months, when dismissal notifications were running at five times the average rate seen between 2008 and 2020.

Lossmaking German truck and bus manufacturer MAN plans to cull up to one in four jobs globally in a move that will add to concerns about the strength of the recovery in Europe’s largest economy, the Financial Times reported. The cutting of up to 9,500 jobs is part of an overhaul of the business, designed to achieve a return on sales of 8 per cent by 2023 and generate about €1.8bn of cost savings, the company said on Friday.

Personal insolvency applications reached a record high in July, according to figures from business and credit risk analyst CRIF Vision-net, The Irish Times reported. The Insolvency Service of Ireland (ISI) received 239 applications for personal insolvency arrangements, debt relief notices and debt settlement arrangements. This is a 125 per cent increase on the 106 applications made in July last year. The number of applications to the ISI have been higher in almost all months this year in comparison to 2019, CRIF Vision-net said, but July has seen the largest spike to date.

Bonds sold to finance a $13 billion airport in Mexico City that was ultimately scrapped are among the region’s worst performers as investors question the revenue stream that backs them, Bloomberg News reported. Notes due in 2047 from the Mexico City Airport Trust had a volatile first half and are now poised for their fourth straight weekly decline. Their drop to 86 cents on the dollar from above par at the beginning of the year is the seventh-worst performance in the Bloomberg Barclays Latin America Bond Index. The notes have a tumultuous history.

New Look is set for another clash with its landlords next week as it prepares to ask for further big cuts in rents with a warning that it could go bust without them, the Financial Times reported. The fashion retailer, which has almost 500 stores and employs more than 12,000 people, is proposing its second company voluntary arrangement in as many years as it contends with a hit to sales from coronavirus.

EU finance ministers meeting in Berlin vowed not to cut short the recovery with a premature fiscal clampdown, as they decided to postpone any debate over when to reimpose the bloc’s budget restrictions or how to reform them, the Financial Times reported. Paschal Donohoe, the president of the eurogroup and Irish finance minister, said member states were developing new policies to boost their economies and pledged that there would be “no sudden stop, no policy cliff-edge”.

Turkey had its debt rating cut deeper into junk by Moody’s Investors Service, which warned of a possible balance-of-payments crisis in assigning the lowest grade it’s ever given to the country, Bloomberg News reported. The sovereign credit rating was cut to B2, five levels below investment grade and on par with Egypt, Jamaica and Rwanda. The company kept a negative outlook on the rating, saying fiscal metrics could deteriorate faster than currently expected.

The number of firms declaring insolvency in Germany was 6.2% lower than in the first half of last year despite the coronavirus crisis, the Statistics Office said, partly because of a rule designed to keep firms afloat in the pandemic, Reuters reported. In March, the government gave companies that find themselves in financial trouble due to the pandemic a respite by allowing them to delay filing for bankruptcy. That was later extended until the end of the year.

European policymakers appear to have contained economic destruction from the pandemic by administering a strong dose of monetary policy, government stimulus, and restrictions on travel and gatherings, the International New York Times reported. But the measures came with an unwelcome side effect. The euro has risen 10 percent against the dollar since March, a vote of confidence by investors that also creates big problems for European exporters.