Headlines

An Garda Síochána are investigating a series of loans raised on peer-to-peer lending websites last year after a Co Kerry company closed its doors without repaying its six-figure debts, The Irish Times reported. The company, Premier Irish Golf Tours, raised several hundred thousand euro on crowdfunding websites last summer. The websites connect individual lenders with businesses that want to raise money. Correspondence sent to the lenders on one of the sites, Linked Finance, shows that the Garda are investigating the company after a complaint by the website.

John Authers wrote earlier this week about how China will help set the course of U.S. stocks for a while. The unfortunate catch is that China’s economy is clearly in trouble, a Bloomberg View reported. Wall Street seems to hang much of that on President Donald Trump’s trade war, which certainly doesn’t help. But there are disturbing signs China’s problems have deep roots, Noah Smith writes. Ever since the financial crisis, he notes, China’s productivity has been weak. This, along with flagging population growth, is a toxic economic combo.

Bank of England Governor Mark Carney on Wednesday likened the $2 trillion (£1.55 trillion) leveraged loan market to subprime mortgages that defaulted 10 years ago and triggered a global financial crisis, in a warning to MPs, the International New York Times reported on a Reuters story. Leveraged loans are made to companies that are highly indebted, and growth has been driven by investment funds and collateralised loan obligations (CLOs) linked to the loans. "We are concerned just because the pace of growth has been quite rapid for some time," Carney told the MPs.

Should a country embrace buyout groups with a growing appetite for its assets or repel them as rapacious capitalism on fears of job cuts and short financial gains? That’s the question facing Spain — which for the greater part of the past decade has suffered a steep economic crisis — as it finds itself luring a growing number of buyout funds looking to snap up assets, according to DD’s Javier Espinoza, the Financial Times reported.

A prominent South African fund manager stands to become one of the biggest losers on a batch of New Look’s bonds that were in effect rendered worthless when the UK retailer launched a debt restructuring this week, the Financial Times reported. New Look set out terms of a debt-for-equity swap on Monday that will hand one-fifth of the company to so-called senior secured bondholders — owners of debt linked to specific assets. Meanwhile, holders of £176m of unsecured bonds have been offered just 2 per cent of the equity in the struggling fashion retailer.

In a related story, Reuters reported that Etihad Airways has offered to invest in debt-laden Indian carrier Jet Airways Ltd at 150 rupees ($2.11) per share, along with an immediate release of $35 million after certain conditions are met, CNBC-TV18 reported here on Wednesday, citing sources. The offer comes at a staggering 49 percent discount to Jet’s closing price of 293.70 rupees on Tuesday. Jet Airways shares tumbled after the report, falling as much as 7.5 percent to 271.75 rupees in their biggest intraday percentage loss since Dec. 10, 2018.

Jet Airways India Ltd. is working with lenders to revamp its debt as the struggling carrier tries to shore up its financials after recording losses in nine of the past eleven years in a market known for ultra-low fares, Bloomberg News reported. The carrier is working on “various options on the debt-equity mix, proportion of equity infusion,” the Mumbai-based company said in a statement on Wednesday. Among options considered by the lenders led by State Bank of India Ltd.

Britain’s financial watchdog has dropped a criminal probe into Credit Suisse related to an alleged fraud in Mozambique, but is still checking the bank and individuals for any breaches of conduct rules, the watchdog said on Tuesday. In 2016, the Financial Conduct Authority (FCA) launched an investigation into the Swiss bank’s activities in Mozambique, where around $2 billion of loans to state-owned companies pushed the country into a debt crisis, Reuters reported.

Corruption-ensnared Odebrecht SA has proposed that creditors take over its sugar and ethanol unit, Atvos Agroindustrial Participacoes SA, in exchange for reducing Odebrecht’s huge debt load, according to two sources with knowledge of the matter. The move is the latest sign of the radical way in which Brazilian conglomerate Odebrecht, best known for its engineering and construction operations, is remaking itself to renegotiate 70 billion reais (£15 billion) in consolidated debt, Reuters reported.

Banco Santander said it will no longer hire Andrea Orcel, the outgoing boss of UBS’s investment bank, as its chief executive in a big U-turn just four months after Spain’s largest lender announced his appointment. Santander said the reversal was triggered by the amount that the bank would have had to pay Mr Orcel to compensate him for deferred stock awards that he earned during his seven-year career at UBS, the Financial Times reported.