Headlines

Japan's economy may have suffered a deeper contraction than initially thought in the December quarter on an expected downgrade to business spending figures, as the coronavirus outbreak fuelled fears of recession in the current quarter, the International New York Times reported on a Reuters story. Any downward revision in final gross domestic product (GDP) due on Monday could dash hopes for a domestic-led recovery in the export-reliant economy, with the October's sales tax hike hurting private consumption.

Italy's banking lobby is asking European authorities to ease rules on problem loans for at least six months, as a coronavirus outbreak hits the economy and throws the fragile sector's recovery off course, the International New York Times reported on a Reuters story. Europe's worst flare-up of coronavirus is expected to have pushed Italy into a new recession as measures to prevent the spread of the virus cripple economic activity, threatening an increase in the number of bad loans that Italian banks have worked hard to reduce in recent years.

The Securities Investors Association (Singapore) invited Hyflux Ltd. to a townhall meeting for the company to respond to investors’ concerns about its debt-restructuring plan, Bloomberg News reported. SIAS proposed holding the townhall between March 11 and 17, the association said in a letter posted on its website. The investor advocacy group will hold a follow-up meeting with its advisers and investors.

Deutsche Lufthansa AG is looking into government support amid the “immense” fallout from the coronavirus, which could burden travel demand for months, Bloomberg News reported. To avoid layoffs after slashing capacity by as much as 50%, the airline is examining the implementation of so-called short-time work, the company said in an emailed statement to Bloomberg on Sunday. The program, known as “Kurzarbeit” in German, involves the government offsetting wages lost when companies are forced to temporarily halt work.

Argentina’s latest debt dilemma is whether to pay or delay its local peso debt, Bloomberg News reported. While the country’s billions of dollars in foreign debt with private creditors and the International Monetary Fund have been the primary focus for investors, the nation now faces a hurdle that’s just as large: the almost 1.8 trillion pesos ($29 billion) in local debt maturing this year, an amount roughly equivalent to all the cash in circulation in the country. And while the fact that it’s in pesos should have lessened the burden, Argentina is finding it tough to refinance.

Of all the private banks set up during India’s go-go-years early in the new millennium, Yes Bank was the most ambitious and aggressive, the Financial Times reported. Founded by two career banking professionals who married sisters, Yes Bank had a reputation for taking risks spurned by India’s more conservative private lenders. Initially the scale of its ambitions — as embodied by flamboyant managing director Rana Kapoor — made it a darling among foreign investors, who provided Yes with a tide of growth capital as they looked to bet big on India’s economic ascent.

The coronavirus outbreak couldn’t have come at a worse time for PT Garuda Indonesia, pummeling demand at the flag carrier just as it faces a debt bill for half a billion dollars, Bloomberg News reported. Debt market concern about sagging travel demand and the impact of financial market turmoil has caused Garuda’s $500 million notes due on June 3 to tumble to a record low of 55.3 cents on the dollar, according to Bloomberg-compiled prices. The securities have dropped 5.9 cents this week after sinking 36 cents last week.

Lebanon is set to default on its debts for the first time on Monday as its foreign currency reserves plummet to critically low levels, the Financial Times reported. Prime minister Hassan Diab has said that Lebanon will not be able to pay a $1.2bn Eurobond that matures on Monday as the country’s economic crisis deepens. The government is now preparing for negotiations with its creditors as it grapples with debts of more than $90bn, equivalent to about 170 per cent of the country’s gross domestic product.

Moody’s downgraded Oman’s credit rating deeper into junk territory on Thursday citing the Arab country’s lower fiscal strength, evident in its higher government debt and weaker debt affordability metrics than the ratings agency expected. Moody's cut Oman's rating here to 'Ba2' from 'Ba1' and changed the outlook to stable, Reuters reported. On Feb. 23, Oman’s Sultan Haitham bin Tariq al-Said said the government would work to reduce public debt and restructure public institutions and companies to bolster the economy.

The German Company Heuschkel Druckguß GmbH filed for insolvency proceedings at the District Court of Nuremberg due to imminent insolvency, Spotlightmetal reported. The business operations of the aluminum and zinc die casting foundry will continue without restrictions even after the insolvency application. The wages and salaries of the approximately 90 employees are secured by the insolvency money up to and including April. As the cause of insolvency, the company cited a significant drop in orders from a major customer which could not be offset by the acquisition of new customers.