Headlines

The latest bond failure by a Chinese local government investment arm has rekindled concerns about a group of borrowers whose outlook is closely tied to Beijing’s shifting definition of its implicit backing, Bloomberg News reported. The debt woes faced by Hohhot Economic & Technological Development Zone Investment Development Group, a local government financing vehicle from Inner Mongolia, have sent chills among investors holding other such LGFV bonds, driving prices sharply lower for some.

The International Monetary Fund gave tentative approval to a $5.5 billion lending program for Ukraine, after months of prodding Ukraine’s new president to clean up corruption and straighten out the banking sector, the Wall Street Journal reported. A new lending program for Ukraine would be a signal for investors who have worried about Ukraine’s direction under its new president, a former television actor with scant political experience who was elected in April on an anticorruption platform.

South African President Cyril Ramaphosa said today that South African Airways (SAA) had to be placed on “business rescue” because there was no other viable and financially workable option to secure a credible future for the state-owned airline, Reuters reported. SAA has been posting losses since 2011 and is deeply in debt. It has received more than 20 billion rand ($1.4 billion) in government bailouts over the past three years, which has achieved little more than keeping it barely afloat. Ramaphosa ordered SAA on Wednesday to seek a business rescue as the airline is close to collapse.

A Brazilian bankruptcy judge has pushed back the sale of two soy crushing plants after U.S-based grain trader Bunge Ltd alleged the seller provided insufficient information about the assets, according to court filings seen by Reuters on Friday. The auction of the two plants by privately owned Imcopa group, rescheduled to Feb. 17 from Dec. 4, is part of the seller’s plan to emerge from bankruptcy. Imcopa and a court-appointed judicial administrator agreed to cancel this week’s auction of the two strategic plants in Paraná state, court documents showed.

Alberta may consider buying back some of its bonds in an effort to smooth its maturities as its debt outstanding rises, Bloomberg News reported. The buy-back strategy, including terms and amounts, is still under analysis, according to Jerrica Goodwin, an Edmonton-based spokeswoman at Alberta’s finance ministry said. The plan, which may start as soon as the next fiscal year beginning in April, won’t reduce overall debt outstanding but could allow Alberta to spread out maturities over the longer term, she said.

Prime minister Shinzo Abe has launched Japan’s first fiscal stimulus since 2016 with a larger-than-expected ¥13.2tn ($121bn) package to repair typhoon damage, upgrade infrastructure and invest in new technologies, the Financial Times reported. Described as a “15-month budget”, the spending package is one of the largest since the 2008-09 financial crisis as Japan seeks to fend off weakness in the global economy, drag from a recent rise in consumption tax and the risk of a slowdown after next summer’s Tokyo Olympics.

The owners of Fishshack and Ouzos restaurants will sell some of its properties as part of a rescue deal, the Irish Times reported. The chain’s owner, PBR Restaurants, sought High Court protection from its creditors in August after running into financial difficulty. PBR owed €700,000 to suppliers and other unsecured creditors. As part of a rescued deal that the court approved on Monday, the company will sell restaurants in Blackrock and Dalkey in Dublin and focus on the Fishshack business.The plan also involves a new investor providing cash for the chain.

Argentine soy crushing giant Vicentin is struggling to repay over $350 million in debt and some plants are likely to halt production while it seeks relief amid an economic slowdown in the country, a source close to the firm said on Thursday, Reuters reported. The grains crusher, Argentina’s top exporter of processed soy last year according to government data, said it had been hurt by increasing financing costs and rising country risk, and was looking at how to meet its obligations.

As investors brace for the biggest dollar default by a Chinese government-owned borrower in decades, a new breed of state asset managers tasked with cleaning up the mess is gaining equal attention, Bloomberg News reported. Trading firm Tewoo Group Corp., a onetime Fortune Global 500 company that seemed like a good bet for a full official bailout thanks to its state ownership, is struggling to make payments on its $2.05 billion of offshore debt.