Headlines

Pick five of the worst affected businesses by the pandemic, then put them in a portfolio. That neatly sums up the storied Hong Kong conglomerate Swire Pacific. The businesses of the two-century-old British-controlled hong, including airlines, commercial real estate, hotels and marine services, have suffered, the Financial Times reported in a commentary. Once one of the largest constituents in the Hang Seng index, today it is the smallest. Swire — Taikoo in Cantonese — reported a net loss of HK$7.7bn ($1bn), its first half-yearly loss in more than a decade.

Lenders to the world’s biggest airport baggage-handling group Swissport have offered a rescue package that would restructure its €2.1 billion of net debt and could transfer ownership to them from struggling Chinese conglomerate HNA Group, The Irish Times  reported. The owners of €1.4 billion of senior secured bonds issued by Swissport have promised to invest in the business to help it survive the pandemic, which has hit its operations hard with the grounding of flights.

Banks and financing platforms are being swept along as punters look for quick cash to bet on the world’s most volatile equity market. It’s a dangerous strategy both for already overextended households as well as lenders, one that’s drawing closer scrutiny from regulators, Bloomberg News reported. Authorities are also partly to blame. With the economy reeling from the pandemic, policy makers have pumped out liquidity and eased curbs on shadow banking to backstop small businesses and struggling families.

Fitch Ratings said it downgraded the province of Entre Ríos in central Argentina to C from CCC after the provincial government missed a payment on its 8.75% 2025 bonds, LatinFinance reported. Entre Ríos was scheduled to pay $21.9 million in interest on August 8, but it said on August 6 that it planned to renegotiate the 2025 bonds due to negative macroeconomic impact of the COVID-19 pandemic, Fitch said in a report on Wednesday. The province entered a 30-day grace period for the missed payment as it started the debt restructuring process, Fitch added.

Kenya’s second-biggest bank said loans issued via mobile phones almost halved in the first six months of the year, indicating that the fallout from the coronavirus pandemic is hitting lower-income earners hardest, Bloomberg News reported. Monthly disbursements by KCB Group Plc averaged 4 billion shillings ($36.9 million) to 5 billion shillings, down from 7 billion shillings to 8 billion shillings before the outbreak, and defaults have more than tripled, according to Chief Executive Officer Joshua Oigara. Many of the bank’s mobile loan customers are from the informal sector.

Fashion retailer New Look is to undertake a second debt restructuring in as many years, as it grapples with the effects of the coronavirus pandemic on its already-struggling business, the Financial Times reported. The group will convert £440m of debt into equity and inject £40m of new cash. It will also launch another company voluntary agreement, to switch most of its stores on to turnover-based rents, in a move that if successful would set a significant precedent in the sector.

Japan’s pandemic-hit economy shrank last quarter by the most in records going back to 1955, official data is set to show Monday, with a resurgence of the virus threatening to slow a fragile recovery now under way, Bloomberg News reported. Analysts see gross domestic product contracting at an annualized pace of 27% in the three months through June. That means the world’s third-largest economy will have declined in size for three straight quarters, hit first by trade wars and a sales tax hike, then by the virus.

Prushka Fast Debt Recovery revealed through data sourced from court records that the Australian Taxation Office and other government agencies, typically the largest source of company liquidations, have halted their winding up of businesses, Dynamic Business reported. In April to June, 374 businesses issued Notices of Winding Up Applications, a decrease of 47 per cent compared to the last quarter, and 64 per cent year-on-year.

Credit rating agency S&P Global Ratings said on Wednesday it has downgraded Belize’s foreign currency ratings to SD from CC/C after the Central American country announced details of a debt restructuring plan this week, Reuters reported. Belize in July proposed to creditors that it would capitalize some scheduled payments on its $526 million Eurobond maturing in 2034 because it could not afford to meet them as it battled with the effects of the coronavirus pandemic.

Dutch bank ABN Amro said it would slash the size of its corporate and investment banking business after a series of high-profile losses highlighted excessive risk-taking in the division and exacerbated the impact of coronavirus, the Financial Times reported. The state-backed bank on Wednesday said it would wind down all of its non-European corporate banking operations and stop providing trade and commodity finance, following a review led by Robert Swaak, the new chief executive.