Headlines

Dubai real estate developer Union Properties has completed a payment of 70 million dirhams ($19.06 million) towards its largest lender as part of a debt restructuring plan, it said on Monday, Reuters reported. The restructuring plan, reached in August with its main lender Emirates NBD to restructure its outstanding debt of 946 million dirhams, aims to "improve the Group's cash-flow and restore its standing with the banking sector," the company said in a statement. Dubai’s real estate market, which has been slowing for most of the past decade, was further hurt by the coronavirus crisis.

AirAsia X Bhd (AAX) said BOC Aviation Ltd has applied to intervene in the airline's application to the High Court in respect of its proposed RM63.49 billion debt restructuring scheme, confirming a report by The Edge. In a filing with the bourse, AAX said it is making the clarification in reference to an article by The Edge dated Oct 26 entitled "More hurdles loom over AirAsia X's debt restructuring plan,” The Edge reported.

Deutsche Lufthansa AG told staff that winter schedule cutbacks announced last week will cause it to bench an additional 125 aircraft and temporarily close large parts of its administrative operations, Bloomberg News reported. The reduction will cut the carrier’s active fleet back to the level it operated in the 1970s, with the impact filtering through its operations, it said in a letter to employees seen by Bloomberg. Lufthansa had previously intended to use the planes in an already reduced schedule for the coming months, it said in the letter.

To understand why some of China Evergrande Group’s strategic investors agreed to throw the embattled developer a $13 billion lifeline last month, look no further than their own sources of revenue, Bloomberg News reported. Interior decorator Grandland Group Holdings Co.’s listed unit gets almost 58% of its sales from Evergrande. Hangzhou Robam Appliances’s sales jumped after deepening its cooperation with Evergrande. And the developer has been the largest source of revenue for door maker Beijing Jiayu over the last four years, according to company filings.

In a related story, the Financial Times reported that over the past two decades, China has emerged as the biggest bilateral lender to Africa, transferring nearly $150bn to governments and state-owned companies as it sought to secure commodity supplies and develop its global network of infrastructure projects, the Belt and Road Initiative.

Zambia has three weeks to improve transparency over its debt obligations and make progress toward an IMF-backed reform package, or risk defaulting on its loans, CNBC reported. Last week, a meeting of creditors was adjourned until Nov. 13 after a consortium comprising around 40% of Zambia’s Eurobond holders opted to abstain from voting on the country’s debt relief proposals, rather than voting them down. Experts suggest bondholders are hoping the government can offer more clarity on its debt, particularly to China, and demonstrate progress toward an IMF program ahead of the Nov. 13 meeting.

New restrictions imposed across Europe to curb the spread of Covid-19 forced Europcar Mobility Group to withdraw its earnings guidance for the remainder of this year, with the firm anticipating a return to pre-virus trading only by 2023, Bloomberg News reported. The French car rental group pulled its prediction for the 2020 financial year “due to the uncertainties derived from the second wave” of the virus, it said in a statement on Monday as it presented its third quarter results.

In recent weeks, moratoria on bank loans have expired in some EU countries and, anecdotally, payments have resumed with only a small fraction showing distress. Yet the macroeconomic outlook is uncertain and we cannot rule out a weak recovery with a significant build-up of bad loans, the Financial Times reported in a commentary. The European Central Bank estimates that in a severe but plausible scenario non-performing loans at euro area banks could reach €1.4tn, well above the levels of the 2008 financial and 2011 EU sovereign debt crises.

The Greek government's opposition is trying to block new insolvency legislation that it argues would leave vulnerable mortgage holders more exposed to repossession during the pandemic, Yahoo! Finance reported. The conservative government is overhauling its bankruptcy regulations, replacing a protection program for distressed loans on primary homes, which expired in July, with a state subsidy program. The government says the proposed changes would be better targeted and would ease pressure on banks still coping with a mountain of loans left unpaid during years of financial crisis.

Spain is seeking to use its share of the EU’s €750bn coronavirus recovery fund to revitalise its stalled economy, with the government likening it to the country’s 1986 entry into the bloc or the creation of the European single market, the Financial Times reported. Madrid plans to borrow €27bn against future grants from the fund, long before they are formally approved by the EU. Prime minister Pedro Sánchez’s minority administration hopes to use the money to push through a 2021 budget and consolidate power, while boosting an economy hit hard by the coronavirus crisis.