Headlines

A year ago, Argentina was the darling of global investors. So much so that, when it issued a pioneering 100-year bond, with a yield of just 7.9 per cent, investors gobbled it up — ignoring the fact that the country has defaulted eight times in the past 200 years, the Financial Times reported. Whoops! This week President Mauricio Macri asked the IMF for help, after the peso tumbled to record lows. And that century bond? After rising to 105 per cent of its face value late last year, it is now trading nearer to 85 per cent.

A Shanghai court imprisoned a tycoon who used a mountain of debt to buy the Waldorf Astoria hotel. Small Chinese companies are increasingly saying they cannot repay their bills, as money gets more expensive or harder to find, the International New York Times reported. For other private businesses, the cost to borrow has shot up. Faced with the looming consequences of a decade-long borrowing binge, the Chinese government is intensifying its efforts stamp out risky lending and speculative froth from the world’s second-largest economy.

Ulster Bank has pressed the button on the sale of €1.6 billion of mortgages that are deep in arrears, bringing to more than €12 billion the amount of Irish loans on the market as lenders face mounting regulatory pressure to cut their bad debt levels, the Irish Times reported. The news came as senior central bankers and Oireachtas finance committee members locked horns on Thursday over the approach that overseas buyers of non-performing loans are taking to mortgage holders in default.

Argentina is seeking a “stand-by arrangement” with the International Monetary Fund, according to the government, signalling its willingness to sign up to one of the organisation’s traditional economic adjustment programmes — complete with potentially politically controversial conditions and oversight, the Financial Times reported. Nicolas Dujovne, Argentina’s Treasury minister, had an “introductory meeting” with the IMF’s Alejandro Werner on Wednesday to discuss how negotiations will proceed. Officials estimated they could take around six weeks.

South Korea said on Wednesday that an impending deal with General Motors to refinance its local unit will ensure the U.S. automaker remains in the country for at least 10 years, as its rights to sell shares and assets will be curtailed, Reuters reported. GM and South Korea reached a preliminary agreement last month to inject $4.35 billion into the loss-making unit to keep it afloat. GM has also announced plans to close one of its four South Korean plants, cut headcount by almost 3,000 and has reached a deal on wages with its workers.

Saudi Arabia’s efforts to ease the burden on ordinary citizens from its promised economic overhaul are taking a toll on its balance sheet, Bloomberg News reported. The increase in the kingdom’s spending on wages and social benefits during the first quarter exceeded what it accrued through higher taxes and lower subsidies, driving the deficit higher to 34.3 billion riyals ($9.2 billion), from 26.2 billion riyals a year ago, according to a quarterly Finance Ministry report.

A gauge of U.K. house prices dipped to its lowest since in more than five years last month, according to the Royal Institution of Chartered Surveyors, with the slowdown most acute in London and the southeast, Bloomberg News reported. RICS’s gauge of prices dropped to minus 8, the lowest since November 2012, the organization said in a report Thursday. The descent into negative territory follows months of stagnating prices, and surveyors don’t expect any pick-up in the near term. The report is the latest to show strain in the U.K.

The cost to insure against a Malaysia default in five years rose in late U.S. trading on Wednesday as an alliance of opposition parties stunned the ruling coalition in a general election, which may result in far-reaching economic consequences, Reuters reported. Malaysia’s Election Commission said Pakatan Harapan had secured a simple majority of 112 seats of the Southeast Asian nation’s parliament’s 222 seats, paving the way for its leader, former Prime Minister Mahathir Mohamad, to become to oldest elected leader in the world.

Goldman Sachs, which was hired in 2007 to manage an abortive attempt to sell Irish Nationwide Building Society (INBS) before the financial crash, told regulators at the time it had concerns over the availability of information from the lender, an inquiry into INBS heard on Wednesday, the Irish Times reported. INBS picked the Wall Street investment bank in September 2007 to run a long-awaited sale of the building society, including the compilation of detailed financial data for prospective buyers.

French factory production fell sharply in the first three months of the year, adding further weight to the mounting evidence of a slowdown in eurozone growth in the first quarter, the Financial Times reported. The quarter-on-quarter fall was led by a quarterly drop in the manufacturing of transport equipment, including car production, and a drop in oil refining. Manufacturing output dropped 1.8 per cent from the previous quarter, while overall industrial output fell 1.3 per cent, the French national statistics agency Insee said.