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Lending standards in the rapidly growing loan market are deteriorating and complex financial products that mask risks to banks have parallels with the run-up to the 2008 financial crisis, the Bank for International Settlements warned on Sunday, Reuters reported. The number of collateralized loan obligations (CLOs), a form of securitization which pools bank loans to companies, has ballooned in recent years as investors hunt for higher returns by buying into loans to lower-rated and riskier companies. Like the collateralized debt obligations (CDOs) that bundled U.S.
President Jair Bolsonaro ’s administration is opening up one of the world’s most closed big economies, slashing import tariffs on more than 2,300 products and exposing local industries long accustomed to protectionism to the challenges of free trade, The Wall Street Journal reported. With little fanfare, the conservative government has since taking office in January eased the entry of ultrasonic scalpels, cancer drugs, heavy machinery and more, in some cases with tariffs reduced to zero from as much as 20%.
The High Court has confirmed the appointment of an examiner to water firm Celtic Pure, which was at the centre of recent product recalls, The Irish Times reported. Mr Justice Michael Quinn also heard that there have been 20 expressions of interest from potential investors in the firm. Last month, the Co Monaghan-based provider of bottled drinking water sought the protection of the court from its creditors due to the fall out from two investigations launched after naturally occurring arsenic in some of the firm’s batches exceeded regulatory limits.
Western Hemisphere nations voted Monday to employ a regional treaty to impose sanctions against embattled Venezuelan leader Nicolás Maduro, accusing his regime of criminal activity including drug trafficking and money laundering, The Wall Street Journal reported. In a meeting convened by the Organization of American States, 16 of the 19 states party to the Inter-American Treaty of Reciprocal Assistance, a 1947 pact known as the Rio Treaty, backed using the pact to collaborate on law-enforcement operations and economic sanctions against Mr. Maduro and his associates.
The IMF sharply increased its forecast for Turkey’s economic growth this year but warned the prospects of a sustainable recovery from last year’s currency crisis have dimmed, the Financial Times reported. In a concluding statement on Monday published after an annual visit by IMF staff, the fund revised its forecast for full-year GDP growth in 2019 from -2.5 per cent to 0.25 per cent. “Growth has rebounded, aided by policy stimulus and favourable market conditions, following the sharp lira depreciation and associated recession in late-2018,” it said.
Mario Draghi said the eurozone economy faced a much more “prolonged sag” than was expected even a few months ago, as the European Central Bank president justified the monetary stimulus he announced this month, the Financial Times reported. Mr Draghi’s comments came after a key survey of business executives showed that the eurozone’s economy was close to stalling, dragged down by a steep drop in German manufacturing activity. The new data hit markets and prompted predictions of imminent recession on Monday.
Britain’s Pension Protection Fund (PPF) said on Monday it would assess the funding levels of Thomas Cook’s retirement schemes, following the collapse of the world’s oldest travel firm, Reuters reported. PPF is an industry-funded scheme set up to protect the pensions of employees in failing companies. “We await notification that the associated schemes have entered PPF assessment,” a spokeswoman said in an emailed statement, adding PPF would protect the pensions of people on Thomas Cook’s defined benefit, or final salary, schemes.
Commerzbank said on Friday it wanted to shed thousands of staff and close a fifth of its branches in a strategy overhaul, after the German lender’s attempt to merge with Deutsche Bank failed, Reuters reported. The bank, partly owned by the German government after a bailout and struggling to generate profits, also aims to sell a stake in its Polish subsidiary mBank and absorb its Comdirect online brokerage unit.
Turkey forced banks to take losses on $8 billion in bad loans this week to kick-start lending and boost its economic recovery after losing patience with them, bankers, senior government officials and industry advisers told Reuters. Ankara’s most aggressive move yet to cure a hangover from Turkey’s 2018 currency crisis has left banks scrambling to meet a year-end deadline to restructure loans or ready them for sale, Reuters reported.