Headlines

Service sector activity crashed across Europe in March as coronavirus lockdowns caused a series of widely watched business surveys to record their largest-ever monthly falls to levels that suggest a severe economic contraction is under way, the Financial Times reported. None of the leading European economies was immune to the economic pain. Italy’s purchasing managers’ index fell to levels far below the worst point in the financial crisis 11 years ago.

Lebanon said it will allow small depositors to withdraw funds from dollar accounts at a weaker rate than the decades-old fixed regime, the first official move away from the country’s currency peg amid a severe liquidity crisis, Bloomberg News reported. With hardly any dollars circulating in the banking system, lenders will pay out at a “market rate” in Lebanese pounds to clients with accounts of up to $3,000, according to a central bank circular issued Friday.

NMC Health Plc convertible bondholders are working with PJT Partners Inc. as the troubled Middle Eastern hospital operator prepares for a restructuring, people with knowledge of the matter said, Bloomberg News reported. PJT is advising a group of investors in NMC Health’s $360 million of convertible bonds due 2025, the people said, asking not to be identified because the information is private.

Around noon on Monday, just when customers might have been starting to sidle into Carluccio’s to order a plate of seafood linguine, the 29-year-old Italian restaurant chain went into administration, the Financial Times reported. It was the first major casualty of the coronavirus lockdown in a sector that has been struggling with some major problems for at least the past two years. Debt levels are high and there is too much competition after private equity piled into the “casual dining” market and encouraged expansion.

The Covid-19 pandemic pushed Moody’s Investors Service to downgrade Argentina, Ecuador and Zambia deeper into junk territory on Friday, Bloomberg News reported. Moody’s warned of escalating default risks in the three developing nations as global coronavirus cases topped 1 million. The combination of stalled trade, low commodity prices and deteriorating growth has sent emerging-market risk premiums soaring. Bonds from Argentina, Ecuador and Zambia have tumbled amid concern the nations may follow Lebanon’s lead in defaulting.

Debenhams’ owners have put restructuring firms on standby as they consider putting the struggling department store group into administration for the second time in a year, the Financial Times reported.

European governments are ripping up their insolvency laws to stem the tide of companies set to collapse over the Covid-19 pandemic, but for many businesses it may be too little too late, Bloomberg News reported. As job losses spike across the continent, the U.K. became the latest nation to propose looser insolvency rules, allowing firms to continue trading even if they can’t pay their debts due to the virus-induced lockdowns. Germany, Spain and others have also sought to ease the burden on companies.

With the future of many coronavirus hit firms in their hands, British banks, still scarred by the financial crisis, are worried that they are being asked by a desperate government to make loans that will never be repaid, Reuters reported. This caution, combined with the challenges of an unprecedented demand for loans, is testing the British public’s fragile faith in the lenders, which have spent a decade trying to rebuild their battered reputations and capital positions.

Moody’s Investors Service slashed the outlook for the Indian banking system to negative from stable citing disruptions to economic activity from the coronavirus pandemic that will worsen the ongoing slowdown and impair lenders’ asset quality, Bloomberg News reported. A deterioration in global economic conditions and a 21-day lockdown imposed by India will weigh on domestic demand and private investment, the ratings agency said in a statement Thursday.

Britain’s largest energy supplier Centrica cancelled its 2019 dividend and cut costs in anticipation of an increase in non payments by customers and a drop in demand due to the COVID-19 outbreak, sending its shares to record lows, Reuters reported. The government has ordered sweeping measures to slow the spread of the new coronavirus, shutting down much of the economy and raising the prospect of mass job losses. Shares in the company hit 34.35 pence on Thursday, morning, their lowest level since the company’s inception in 1997.