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A commodity trader has become China’s first state-owned enterprise to inflict losses on dollar bondholders in two decades, according to S&P Global Ratings, a new landmark in a rising wave of defaults, the Wall Street Journal reported. Chinese authorities are allowing more companies to renege on their debts, where once they would have found ways to engineer bailouts. So far defaults have mostly been concentrated in credit-starved private companies, but even some groups with state backing are now failing to repay creditors as promised.
Moody’s Investors Service said funding challenges at India’s non-bank financing companies are increasing the risk of asset quality deterioration at banks, which are already saddled with the world’s worst bad-debt pile, Bloomberg News reported. Risks of loan losses at shadow financiers will weaken their financials, prompting banks to further reduce lending to them and worsening their funding stress, the ratings company said in a report dated Friday.
U.S. President Donald Trump signed off on a phase-one trade deal with China, averting the Dec. 15 introduction of a new wave of U.S. tariffs on about $160 billion of consumer goods from the Asian nation, Bloomberg News reported. The deal presented to Trump by trade advisers yesterday included a promise by the Chinese to buy more U.S. agricultural goods, according to the people. Officials also discussed possible reductions of existing duties on Chinese products, they said. The terms have been agreed but the legal text has not yet been finalized, the people said.
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The IMF is waiting for the details of the new Argentine government’s economic plans to review its $56 billion credit line, its chief spokesman said, Bloomberg News reported. “I don’t have anything on dates or planned meetings,” with Argentine officials over the $56 billion loan, the International Monetary Fund’s Gerry Rice said yesterday. Economy Minister Martin Guzman had said on Wednesday that he had held a preliminary meeting with IMF Managing Director Kristalina Georgieva before taking office.
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Mothercare Plc said today that it had agreed to supply baby care and other products exclusively to Boots UK stores, keeping its goods on British shelves after the collapse of its retail network in its home market, Reuters reported. Shares in the company, which called in administrators for its UK business last month and is set to close all of its British stores with the loss of at least 2,500 jobs, jumped 10.4 percent to 14.9 pence in response to the news.
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A bankruptcy court has admitted an insolvency resolution plea filed by Bank of Baroda against Mumbai-based Genesis Resorts, which defaulted on loans of about Rs 230 crore, The Economic Times reported. The division bench of judicial member Bhaskara Pantula Mohan and technical member Rajesh Sharma restrained the company and its promoters from transferring, encumbering, alienating or disposing of the company’s assets.
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Indonesia has more reason than most to be wary of backsliding on its commitment to budget discipline, Bloomberg News reported. Its deficit ceiling is an important piece of the economic and political architecture that emerged from the Asian financial crisis of the late 1990s. Indonesia experienced more than just a run on the currency, a deep recession and a rescue by the International Monetary Fund. The crunch morphed into riots, communal violence and the overthrow of dictator Suharto, who had ruled with military backing for more than three decades.
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Lebanon’s caretaker Prime Minister Saad Hariri said he discussed with the heads of the International Monetary Fund and the World Bank a possible plan to ease a deepening financial crisis, Bloomberg News reported. Eurobonds rose after Hariri’s office said on Twitter that he asked the two institutions for technical assistance for the plan, which he said would be implemented by a new government. He also asked the World Bank for help in securing trade finance to prevent any shortages of essential goods.
Indian Finance Minister Nirmala Sitharaman today introduced a bill in the Lok Sabha to amend the Insolvency and Bankruptcy Code, the Times of India reported. The Insolvency and Bankruptcy Code (Second Amendment) Bill, 2019 was approved by the Union Cabinet yesterday. The amendments in the law seek to remove bottlenecks and streamline the corporate insolvency resolution process, wherein successful bidders will bering fenced from any risk of criminal proceedings for offenses committed by previous promoters of companies concerned.
Mexican carrier Jaguar Transportation stopped its trucking services this morning (Dec. 10) and could be shutting down as part of Celadon's U.S. chapter 11 filing on Dec. 9, FreightWaves reported. Several freight and logistics professionals confirmed to FreightWaves that cross-border account representatives for Jaguar Transportation said that they had ceased services. At one of the company's locations, the news prompted drivers who feared they would not be paid to block access to scores of trucks and trailers.