Headlines

After a decade of efforts and $18 billion in state bailouts, Kazakhstan’s banking sector is still in a mess. Just ask the country’s president, Bloomberg News reported. “The financial system is sick,” President Kassym-Jomart Tokayev told a government meeting last month as he railed against declines in business lending and an increase in loans to consumers with little chance of repaying the money.

A row has broken out between some of Lebanon’s biggest foreign creditors as the country slides towards a restructuring of its enormous debt burden. Ashmore, which has amassed a more than $1bn position in Lebanon’s short-dated bonds, is pushing for Beirut to repay a dollar bond that matures next month, despite the parlous state of the country’s finances, the Financial Times reported. The fund manager’s lobbying has drawn criticism from other big emerging-market investors, which boiled over at a client dinner hosted by Bank of America in London last month.

The rand strengthened the most among emerging-market currencies on Friday as investors assessed President Cyril Ramaphosa’s pledges to overhaul South Africa’s electricity industry and curb government spending, Bloomberg News reported. While offering little that is new on the planned restructuring of Eskom Holdings SOC Ltd., Ramaphosa announced sweeping measures Thursday to address power shortages and reduce dependence on the debt-stricken utility.

A state-owned Chinese aluminum producer’s proposal to settle $850 million of defaulted bonds is meeting strong resistance from investors, throwing in doubt a restructuring plan that entails steep losses for bondholders, Bloomberg News reported. On Friday, offshore creditors of Qinghai Provincial Investment Group Co. published a letter to Chinese government entities including top regulators in a Hong Kong newspaper, calling on the defaulter to withdraw its offer of a debt overhaul.

Dubai will take its port operator private after a dozen years to alleviate its debt burden and avoid a repeat of the economic crisis that forced a bailout of the country in 2009, Bloomberg News reported. As a source of cash for the state, DP World Ltd. is a key asset for the emirate as it endures another year of lower property prices and a struggling retail sector. The country has introduced some counter-measures to revive growth, like easing restrictions on visas and tackling oversupply in the real-estate market.

The International Monetary Fund, as the lender of last resort, won’t offer a haircut on its Argentina loan after Vice President Cristina Fernandez de Kirchner called on the institution to take a loss, Bloomberg News reported. “Our legal construct is such that we cannot do measures that may be possible for others without this big global responsibility,” Managing Director Kristalina Georgieva said Sunday in a Bloomberg Television interview in Dubai. An IMF technical mission is in Buenos Aires through Feb. 19 to meet with Argentina officials and assess the country’s debt sustainability.

Sirius Minerals said on Friday talks with a consortium of financial investors on an alternate debt financing proposal to raise $680 million has fallen through, putting the company at the risk of going under administration or liquidation, Reuters reported. “The board confirms that the company has not been able to secure an institutional anchor investor willing to provide sufficient support for the alternative proposal which was part of the consortium’s requirements,” Sirius said in a statement.

An application by two trade unions to block job cuts at struggling state-owned airline South African Airways (SAA) was rejected by the country’s labour court on Friday. SAA is fighting for survival after being placed under a form of bankruptcy protection in December, Reuters reported. The unions argued that SAA’s administrators were planning far-reaching job cuts without holding the proper consultations required by the country’s labour law.

Krungthai Bank (KTB) could be required to set aside higher loan-loss provisions to deal with a potential bad-loan uptick this year as the deteriorating debt-servicing ability of clients is further hit by the sagging economy, the Bangkok Post reported. The bank has implemented several financial assistance measures, including debt restructuring required by the Bank of Thailand, to keep customers afloat during this difficult period, and these aid measures could weaken the bank's asset quality, said Payong Srivanich, KTB's president.

As housing affordability continues to be a consistent struggle for Canadians, new data from the Office of the Superintendent of Bankruptcy (OSB) confirms just how bad Canadian household debt is getting, Toronto Storeys reported. The new data revealed that 2019 saw the second-highest number of annual consumer insolvency filings ever in Canada, with 137,178 Canadians filing for insolvency, a 9.5% year-over-year growth.