Headlines

A planned $500 million bond sale from Papua New Guinea, a country that has tried and failed to sell foreign debt before, will test whether investors are still receptive to riskier borrowers after a selloff in emerging markets, The Wall Street Journal reported. The offering could conclude this week, and would mark the first sale of junk-rated sovereign-dollar debt since July, when Angola sold $500 million in 30-year bonds, according to Dealogic. In recent months, rising U.S. interest rates and a stronger dollar have hit emerging-market stocks and bonds.

The liquidators of the former Anglo Irish Bank claim a US legal action by businessman Paddy McKillen over his “Maple 10” loan is an attempt to frustrate their work. Kieran Wallace and Eamonn Richardson, the liquidators of Irish Bank Resolution Corporation, claim the action taken by Mr McKillen and his partner Tony Leonard in July is an attempt to “end-run IBRC’s properly commenced recovery action in Ireland” through a “poorly disguised” adversary proceeding, The Irish Times reported.

Yeşil Kundura, one of Turkey’s oldest shoe brands, has been granted bankruptcy protection on Monday, Ahval reported on a Hürriyet newspaper story. Turkish business groups have been struggling to stay afloat, as the lira has dropped more than 40 percent against the dollar this year, while, after weeks of inaction, Turkey’s Central Bank raised its benchmark interest rate of 17.75 percent by 625 basis points to protect the lira and to control the rising inflation.

The Turkish government will unveil measures to help banks tackle the expected pile-up of bad loans resulting from the lira’s plunge and soaring interest rates, according to people with knowledge of the matter, Bloomberg News reported. The plan will seek to mitigate the need for capital injections and propose transferring non-performing loans to a state-designated entity, said the people, who asked not to be identified because the deliberations are confidential. The measures are likely to be announced on Thursday, one of the people said.

China’s ever-growing money market funds pose an increasing problem for the nation’s central bank as policy makers attempt to boost the flow of credit to cushion an economic slowdown, Bloomberg News reported. While the funds have offered savers a handy alternative to risky stocks and once high-flying wealth management products, they’re effectively raising borrowing costs.

One of the European Central Bank’s top officials has said policymakers should spell out in more detail what will happen once borrowing costs in the eurozone finally begin to rise. The ECB is set to keep interest rates on hold at their current record lows “through the summer of 2019”, with markets betting on a rate rise at some point in the autumn of next year.

Brazil's state-run oil giant Petróleo Brasileiro SA aims to raise output as much as 10 percent to around 2.3 million barrels per day (bpd) in 2019 and cut net debt by $10 billion (7.62 billion pounds), Chief Financial Officer Rafael Grisolia told Reuters. The world's most indebted oil company is on course to reduce debt to $69 billion by the end of this year despite falling short of its $21 billion asset sales target, Grisolia told Reuters in an interview in New York late Friday.

The European Investment Bank (EIB) is probably the most important EU institution that you may never have heard of. It is the world's biggest development bank, has nearly 4,000 staff, and is based in Luxembourg. The EIB is owned entirely by the EU's 28 governments and Brexit — like in so many other areas — is causing unforeseen challenges, the Financial Times reported. The UK’s departure is seen by some member states as an opportunity to revamp the EIB. It is a fight being fought on three fronts. The fiercest debate is about money.

London-based emerging market fund Gemcorp Group said on Monday it had extended a $250 million loan to Zimbabwe to help the country import essential goods like electricity, fuel and medicine, the company's CEO said. The southern African nation is facing its worst shortages of cash dollars since it dumped its own currency in 2009 in favour of the U.S. currency. This has made it difficult for companies, including mines, to pay for imports, the International New York Times reported on a Reuters story.

Rallye, the debt-laden parent of French supermarket chain Casino, bought more time on Monday ahead of a key bond refinancing deadline as five banks granted it a new 500 million euro (444.50 million pounds) credit line, the International New York Times reported on a Reuters story. Top banks BNP Paribas, Crédit Agricole CIB, Crédit Industriel et Commercial, HSBC and Natixis gave Rallye the additional credit until 2020 with no collateral, demonstrating "their willingness to support Rallye in the long term," Rallye said in a statement.