Headlines

Uncertainty is hanging over the investments of 14,000 customers who put their money into a UK company promising 8 per cent returns after the financial regulator banned it from paying out any interest over concerns about its marketing, the Financial Times reported. London Capital and Finance, which claimed as much as £214m was invested in its individual savings accounts, or ISAs, has been barred from touching any money in its bank accounts after the Financial Conduct Authority launched an investigation.

Jet Airways India Ltd. has missed a payment to Indian lenders in the latest sign of mounting strains at the country’s second largest airline by passengers, after losses worsened a cash crunch, Bloomberg News reported. The setback underscores a lack of progress lining up sufficient funds for debt payments after the beleaguered carrier approached banks for a moratorium on loans and asked for fresh funds in October. Shares in Jet Airways closed down 6.1 percent, the sharpest decline in more than three weeks.

China will cut the reserve requirement ratio and improve funding conditions this month, as liquidity tightens toward the Spring Festival holidays, the country’s largest securities firm says, Bloomberg News reported. Fresh demand for funds will amount to nearly 4.3 trillion yuan ($625 billion) in January, according to Citic Securities Co. and Bloomberg calculations. Mainland residents will withdraw 1 trillion yuan of cash in preparation for the holiday, when money is gifted in red envelopes.

Kaisa Group Holdings Ltd. faces losing its entire investment of almost $150 million in a key urban redevelopment project, underscoring the vagaries in China’s property market, Bloomberg News reported. The Shenzhen-based home builder, which gained notoriety in 2015 when it became the first developer from the nation to default on U.S. dollar debt, has invested more than 1 billion yuan ($146 million) in a project in Xi’an to transform a shanty town into residential dwellings.

A new year, a new central bank governor. Yet the first salvo to come out of the Reserve Bank of India’s policy arsenal in 2019 is encouragement of good old “extend and pretend” lending, a Bloomberg View reported. Banks and shadow banks are being allowed a one-time restructuring of loans of up to 250 million rupees ($3.6 million) to micro, small and medium enterprises that were in default on Jan. 1, without having to mark them as nonperforming, the RBI said on Tuesday. Lenders are being given an extension of 15 months (up to March 31, 2020) to pretend that these stressed loans are standard.

Absa Group Ltd. is having a hard time convincing some investors it can win back the market share lost while under the control of Barclays Plc. South Africa’s third-largest lender was once the leading retail bank with over 10 million customers and more mortgages on its books than any of its Johannesburg-based peers, Bloomberg News reported. Now, released from the shackles of London-based Barclays, Absa Chief Executive Officer Maria Ramos can take on more risk with a plan to grow revenue faster than her main rivals from 2019 to 2021.

India’s central bank will permit lenders to restructure stressed loans to small companies, breaking from a five-year-old policy of eschewing sweeping corporate debt overhauls, Bloomberg News reported. The Reserve Bank of India will allow one-time restructuring of loans to micro, small and medium-sized companies that are in default, the regulator said in a statement on Tuesday. To be eligible for the program, the loan should not exceed 250 million rupees ($3.6 million), according to the statement.

Uncertainty will hobble UK business investment and depress consumer spending in 2019, stunting long-term growth even if Britain manages to avoid a disorderly Brexit, according to a poll of more than 80 leading economists, the Financial Times reported. The best the UK can expect over the year is uninspiring growth remaining at its current level of about 1.5 per cent, even if the economy eventually enjoys a modest rebound on the back of a deal with the EU, the FT’s annual survey on the UK’s economic outlook suggests.

India’s central bank on Monday said the proportion of commercial lenders’ non-performing assets (NPAs) may fall slightly to 10.3 percent by March, thanks to measures including the creation of a bankruptcy code, Reuters reported. In June, the Reserve Bank of India (RBI) had said commercial lenders’ ratio for gross bad loans might even increase to 12.2 percent by March 2019, but they had fallen to 10.8 percent by end-September and now look to dip lower still.

Chinese electric vehicle developer Faraday Future said on Monday it signed a new restructuring agreement with a unit of its main investor, Evergrande Health Industry Group Ltd, ending a bitter legal fight and clearing the path for raising funds, Reuters reported. Season Smart, which agreed to be bought by China’s Evergrande Health, will now own 32 percent preference shares, down from a previous 45 percent, according to filings.