Headlines

Mexico’s finance ministry is considering extending relaxed banking credit rules to help its battered economy recover, a top official said on Wednesday, after it presented an austere 2021 budget that leaves little room to maneuver, Reuters reported. Deputy Finance Minister Gabriel Yorio said the ministry was in talks with the banking industry and the central bank about the possible extension until next year of the temporary measures designed to avoid defaults and loss of collateral.

India’s top court extended the easing of rules over the classification of non-performing loans until further notice, delaying the disclosure of how much bad debt banks hold, Bloomberg News reported. The three-judge bench headed by Justice Ashok Bhushan on Thursday gave the government two weeks to come up with relief measures for virus-hit businesses and said such a decision had to be put before the court for consideration. It also reiterated that banks must not classify any loans as bad if they were performing at the end of August until further order.

Euromoney Institutional Investor plans to cut up to 240 jobs, as one of Europe’s largest financial publishers becomes the latest media group to suffer as a result of the Covid-19 pandemic, the Financial Times reported. In a note circulated to staff on Thursday morning, chief executive Andrew Rashbass said the FTSE 250 group had to “respond to the world as it now is, particularly in events, but in other areas as well”. It has launched a restructuring process that will put just over 10 per cent of staff roles under review.

Britain’s sparsely populated offices have put the economy in a quandary. The dry cleaners, coffee shops, lunch places and clothing retailers specializing in suits that serve areas packed with offices are starved of their customers, the International New York Times reported. In a country that relies on consumer spending to fuel economic growth, the government and business lobby are urging people to return to their offices, pressuring civil servants to set an example, and in turn spend more money on food and travel and in city center shops.

A U.S. bankruptcy judge on Thursday rejected a $2.4 billion financing plan for struggling LATAM Airlines on the grounds that a convertible loan included as part of the package would amount to “improper” treatment of other shareholders, Reuters reported. The move is a setback for LATAM, which needs short-term liquidity. But in a lengthy court decision, the judge left the door open for the Chilean carrier to introduce a similar financing plan in the future, this time without the possibility of converting part of the loan into equity. The airline had no immediate comment on the decision.

South African Airways needs short-term funding from the government by the end of next week for the state carrier’s business rescue process to continue, its administrators said on Thursday, Reuters reported. “It is prudent to advise affected persons of the company’s dire financial position,” they said in a statement.

Kenya’s two biggest banks are probably over the worst as far as potential loan losses go, but may still struggle to boost revenue in the wake of the coronavirus pandemic, according to AIB-AXYS Africa, Bloomberg News reported. Equity Group Holdings Plc increased first-half provisions eightfold, while KCB Group Plc’s rose almost four times from a year earlier, hurting earnings. The nation’s lenders are helping customers restructure their debt after the Covid-19 outbreak stalled economic output and shut schools.

A World Bank-backed power plant that provides a tenth of Nigeria’s electricity is at risk of a default on its loan payments because of a severe dollar shortage in the continent’s biggest economy, according to three people briefed on the matter, the Financial Times reported. The $900m Azura-Edo Independent Power Plant in Edo state has been unable to source dollars through the Central Bank of Nigeria, which has restricted access to the greenback in an effort to support the local naira currency, according to an industry executive and a financier briefed on the matter.

AirAsia Group Bhd. is seeking to raise as much as 2.5 billion ringgit ($600 million) by the end of the year as it tries to survive a business slump exacerbated by the coronavirus pandemic, Bloomberg News reported. The Subang, Malaysia-based budget carrier may borrow up to 1.5 billion ringgit from banks and another 1 billion ringgit from investors, a spokeswoman said Tuesday.

Financial investor KKR is injecting 125 million euros ($147 million) in additional capital into crisis-hit Swiss snack machine operator Selecta under a debt restructuring agreement, Reuters reported. In addition, outstanding bonds would be converted into securities that would not mature until 2026 in a move that will significantly reduce the company's high level of indebtedness, Selecta said (here) in a statement released late on Tuesday. Major shareholder KKR, creditor banks and a substantial portion of the bondholders had agreed to the recapitalisation.