Headlines

The German government has said it still expects the 150 million-euro ($175 million) loan granted to Air Berlin to be repaid in full, after a court opened formal insolvency proceedings against the carrier on Wednesday, Reuters reported. The loan granted in August had kept Air Berlin planes in the air while administrators held talks with prospective buyers of the airline’s assets. “The loan of 150 million euros will be repaid from the proceeds of asset sales,” a spokeswoman for the economy ministry said on Thursday.

Baghdad’s talks with Turkey about ramping up oil exports from northern Iraq, including the semi-autonomous Kurdish region, is complicated by a $4 billion debt that the Kurds owe to Turkey, according to Iraq’s oil minister, Bloomberg News reported. Iraq is seeking an agreement with Turkey for all exports from the north, including the Kurdish region and the disputed province of Kirkuk, through a pipeline currently operated by the Kurds, Jabbar al-Luaibi told reporters in Baghdad. Iraq’s state-run Oil Marketing Co., known as SOMO, would control all exports under the agreement, he said.

The Bank of England has increased interest rates for the first time since 2007, despite fears for the fragility of the UK economy as its 2019 departure from the European Union nears, the Irish Times reported. Policymakers on the bank’s Monetary Policy Committee (MPC) opted to increase interest rates to 0.5 per cent, up a quarter of a point, by a majority of seven to two.

One of the more persistent beliefs about the global economy is that Asians are more frugal than others. Whatever the true reason, data long supported the basic claim that Asian households were indeed careful with their cash. But over the past few years consumers across the region have done their best to prove that prudence was perhaps just a passing phase.Household debt in advanced economies has generally declined as a percentage of GDP since the 2008 global financial crisis, according to the Bank for International Settlements.

Danske Bank in Northern Ireland has reported a pre-tax profit of £77.4 million (€88.1 million) for the first nine months of 2017. The latest financial results show a £20 million year on year fall in pre-tax profits - over the corresponding period in 2016 Danske Bank’s profits had previously hit £98.1 million, the Irish Times reported. The Copenhagen headquartered bank has blamed the “adverse impact” of the Bank of England’s base rate on its income levels as well has higher expenses from a restructuring programme.

An Air Berlin plane that was grounded in Iceland last month over unpaid charges is due to be flown home on Wednesday, a spokesman for the insolvent carrier said. The A320 jet with registration D-ABDX was grounded on Oct. 19 after arriving at Keflavik airport, Reuters reported. A spokesman for the airport operator said the debt had been paid on Monday and the aircraft was free to leave. The plane is due to leave Keflavik at 1600 GMT and will be flown to Berlin Schoenefeld airport, where it will eventually join the fleet of British budget carrier easyJet, the Air Berlin spokesman said.

The Greek government is planning an unprecedented debt swap worth 29.7 billion euros ($34.5 billion) aimed at boosting the liquidity of its paper and easing the sale of new bonds in the future, Bloomberg News reported. Under a project that could be launched in mid November, the government plans to swap 20 bonds issued after a restructuring of Greek debt held by private investors in 2012 with as many as five new fixed-coupon bonds, according to two senior bankers with knowledge of the swap plan. The bank officials requested anonymity as the plan has yet to be made public.

Bahrain has asked Gulf Arab allies for financial assistance as it seeks to replenish its foreign-exchange reserves and avert a currency devaluation that could reverberate across the region, according to people with knowledge of the talks. The request was made to Saudi Arabia and the United Arab Emirates, two of the people said. A third person said Kuwait was also asked.

Venezuela appeared to have made a crucial bond repayment in the nick of time on Wednesday but the chaos surrounding the instalment stirred nervousness that the crisis-ridden country might finally be running out of money ahead of another big debt payment due on Thursday, the Financial Times reported. The Latin American country and its state oil company PDVSA have failed to make several debt payments in recent weeks.

After years of propping up lossmaking state companies with fiscal subsidies and cheap credit, one Chinese province has embraced privatisation to cast off its burden, setting a precedent for dealing with thousands of “zombie enterprises,” the Financial Times reported.  Dongbei Special Steel, based in the north-east rust-belt province of Liaoning, is a high-profile example of the excessive debt and poor profitability that has plagued thousands of lossmaking state groups.