Headlines

Ecuador pushed forward with its debt overhaul plans on Monday, requesting a vote among its creditors on reconfiguring the terms of $17.4 billion of its external bonds, with its largest group of creditors backing the proposal, Reuters reported. Under the proposed deal - unchanged from the government’s earlier proposal - 10 existing bonds maturing between 2022 and 2030 would be swapped for three bonds due in 2030, 2035 and 2040, as well as a past due interest bond maturing in 2030.

Amigo Loans warned on Monday that there was “material uncertainty” over its ability to continue operating, as the UK subprime lender grapples with rising customer complaints, a regulatory investigation and the coronavirus crisis, the Financial Times reported. The company said it was confident it had “adequate liquidity” but cautioned that additional financing would be needed if customer complaints were higher than expected for a prolonged period, or if the Financial Conduct Authority forced the group to carry out a major remediation exercise.

Australia faces an avalanche of business failures in its transport and hospitality sectors after government subsidies end in September, insolvency lawyers and economists say, while some argue that so-called ‘zombie’ firms should be allowed to fail, Reuters reported. About 240,000 businesses in tourism and professional services are at high risk of failing during the September ‘fiscal cliff’, when widespread wage subsidies are set to end, economists at Deloitte said on Monday.

India’s Infrastructure Leasing & Financial Services (IL&FS) said on Monday it expected to resolve about 57% of its near trillion rupee ($13.35 billion) debt pile even as the pandemic delayed the resolution process in some of the group companies, Reuters reported. About 50% of the debt is expected to be resolved by March 2021, the indebted infrastructure lender’s board said in a progress report, with 18% already addressed as of June end. The board had said in an update in October that it aimed to resolve 50% of the debt by March this year.

Bondholders in Virgin Australia Holdings Ltd, in administration since April, on Monday submitted an updated proposal to take over the struggling company that rivals the approach from Bain Capital selected by administrator Deloitte, Reuters reported. The new proposal from bondholders Broad Peak Investment Advisers and Tor Investment Management is “substantially the same” as a recapitalisation pitch for Australia’s second-biggest airline they lodged last month, a spokesman said in a statement.

Argentina’s three largest creditor groups joined forces to submit a new bond restructuring proposal that would provide the country more than $35 billion in debt relief over the next nine years, Bloomberg News reported. The Ad Hoc group, the Exchange Bondholder group and the Argentina Creditor Committee, which represent investors including BlackRock Inc. and Ashmore Group PLC, said that they had agreed to form a negotiating bloc and reject the government’s latest offer.

Nigerian banks are restructuring 41% of loans in the country after the central bank placed a moratorium on interest charges and principal debt repayments to cushion the blow of lower oil prices and fallout from the coronavirus, Bloomberg News reported. Loans worth 7.8 trillion naira ($20 billion) to 35,640 customers are being reorganized out of 18.9 trillion naira in credit across the industry, Central Bank of Nigeria Governor Godwin Emefiele said on Monday. Twenty-two of the nation’s lenders are involved in the transactions, he said.

Mendocino Clothing Co., a Toronto-based retailer, has begun restructuring proceedings and plans to close stores to focus on online orders, Bloomberg News reported. The closely-held company filed a notice of intention to make a proposal under Canadian bankruptcy law on July 14, according to documents posted on the website of KSV Kofman Inc., the trustee. The documents listed Toronto-Dominion Bank as a secured creditor owed C$2.69 million ($1.99 million) and a further C$5.78 million owed to unsecured creditors including American Express and OPGI Mgmt.

The Group of 20 leading economies this weekend may have to consider expanding help for the world’s poorest countries, three months after agreeing to provide temporary debt relief, as the coronavirus pandemic continues to ravage nations, Bloomberg News reported. Central bankers and finance ministers from the G-20 will hold a virtual meeting on Saturday to discuss and coordinate phased efforts to spur a global economic recovery. Looking beyond just debt relief efforts would be part of that.

Bank of Japan policymakers debated the risk of the country sliding back into deflation but stopped short of advocating stronger steps to prevent firms from going insolvent due to the coronavirus pandemic, minutes of their June meeting showed, Reuters reported. With the impact of COVID-19 likely to last for a prolonged period, more companies could face the risk of insolvency even if they received immediate liquidity support, some on the BOJ’s nine-member board were quoted as saying.