Headlines

Euro zone finance ministers will discuss on Oct. 1 how they can get a precautionary loan from the euro zone bailout fund more easily, but are unlikely to take final decisions before agreeing on a whole package of euro zone reforms in December, the International New York Times reported on a Reuters story. The bailout fund, the European Stability Mechanism (ESM), now offers a Precautionary Conditioned Credit Line (PCCL) that is similar to a loan offered by the International Monetary Fund and can be granted to a euro zone country with a sound economy.

The British government will step in to bail out a 335 million pound new hospital in the city of Liverpool, after the collapse of Carillion, which was overseeing the deal, Sky News reported on Monday. An announcement by ministers on the termination of the Royal Liverpool Hospital private finance initiative deal and taking it into full public ownership is expected to be made within days, Sky said.

The United Arab Emirates’ banking group is considering whether to ask the central bank to relax mortgage lending rules to stimulate a fragile real estate market, sources familiar with the matter said. At the moment, first-time buyers of a home worth up to 5 million dirhams can only borrow up to 80 percent of the property value if they are UAE citizens, while the cap is 75 percent for foreigners, Reuters reported. The UAE Banks Federation’s retail banking committee has proposed that the limit be raised to 85 percent for UAE nationals and 80 percent for foreigners, the sources said.

One of Portugal’s wealthiest people, Paula Amorim, and Vangard Properties have presented a joint bid for part of the oceanside Comporta estate, the country’s largest privately-owned property. Comporta was the Espirito Santo family’s largest real estate holding. It is now held by liquidators following the 2014 collapse of the family business and the bank founded by them, Banco Espirito Santo, Reuters reported. The property, which stretches over a 1,300 hectare area of coastline south of the city of Setubal, includes plots for villas, golf courses and comes with licenses to construct hotels.

Debenhams Plc is known for being constantly on sale. But if its fortunes don’t improve in the next few months, it may well have to attempt a controversial property restructuring, a Bloomberg View reported. This might set billionaire shareholder Mike Ashley up for another high street bargain. The Sunday Telegraph reported Sept. 8 that Debenhams, which warned on profit three times this year, was considering a CVA, a mechanism retailers have been using lately to obtain creditor agreement to close some stores and cut rent on others.

The turmoil in India’s non-bank finance companies is deepening, with a troubled lender disclosing further missed debt payments late on Friday and panic seeping into what has been Asia’s best-performing stock market, Bloomberg News reported. The benchmark equity index had its wildest intraday move in more than four years before closing with a 0.8 percent loss on Friday as investors remained jittery about the nation’s financial shares after a recent default by Infrastructure Leasing & Financial Services Ltd. A measure of investor anxiety surged to its highest level in more than four months.

Chinese local governments are flooding the debt market with a new type of bond, lining up $200bn in issuance designed to fund infrastructure investment as Beijing seeks to stimulate a slowing economy, the Financial Times reported. China’s parliament in March approved a quota of Rmb1.35tn ($197bn) for issuance of “special-purpose” bonds for 2018, more than the combined quotas for the previous two years. But until recently, actual issuance was sluggish as local governments were under pressure to cut borrowing.

The cost of insurance on Lebanese sovereign bonds has soared in recent weeks, reflecting concerns about the sustainability of the country’s debt burden as its economy slows and faces a potential cash crunch, the Financial Times reported. Like many emerging markets, rising global interest rates are swelling Lebanon’s external financing costs as the economy’s growth rate slows to 1.3 per cent this year. The country has the world’s third highest debt-to-GDP ratio at 150 per cent, a legacy of borrowing from public markets to rebuild after its devastating civil war.

Infrastructure Leasing & Financial Services Ltd., an Indian conglomerate that has missed payment on more than five of its obligations since August, is seeking to raise more than 300 billion rupees ($4.2 billion) selling assets to cut debt, according to an internal memo seen by Bloomberg.

Ukraine posted its tenth successive quarter of growth earlier this year with a 3.6 per cent year-on-year increase in GDP in the period April to June. Although still well below its real potential growth rate, this is progress for a country that stood on the brink of financial collapse four years ago, the Financial Times reported in a commentary. It also represents a qualified success for western policy, which eschewed a military role in the conflict with Russia in favour of measures designed to shore up Ukraine’s economic sovereignty.