Headlines

Overseas private-equity and hedge funds are currently circling as much as €11 billion of Irish loans, mainly mortgages, that have been put in the market by three of the most active lenders during the property bubble. Permanent TSB said on Tuesday that it had pressed the start button on the sale of a portfolio of loans known as Project Glas as it seeks to lower its level of non-performing loans (NPLs), the Irish Times reported. It is understood that the portfolio, being marketed by EY, contains up to €2 billion of private and buy-to-let mortgages, based on their original value.

Chinese deal makers that racked up debts for overseas deals and are now reversing course to pay down borrowings have attracted the attention of restructuring specialists, Bloomberg News reported. As President Xi Jinping steps up leverage curbs, borrowing costs in China have jumped. The nation’s most high-profile deal makers including HNA Group Co. have come under mounting regulatory scrutiny, and have been selling assets as they try to rein in borrowings.

Zambia’s cabinet approved plans to restructure the country’s loans from China after the International Monetary Fund said Africa’s second-biggest copper producer was at high risk of debt distress, Bloomberg News reported. The government will also source financing directly from Chinese lenders rather than through contractors in a bid to cut the cost of borrowing, the presidency said Tuesday in an emailed statement.

Companies controlled by Chinese local governments have avoided defaulting on their bonds so far. They will not continue to be so lucky, the Financial Times reported. Officials are taking a regulatory axe to the implicit supports that have allowed hundreds of local government financing vehicles to stagger on.

Recent market turmoil has not deterred relatively risky countries from their debt-raising plans. Kenya has appointed banks to raise 30-year debt — a plan that would make it one of just a handful of sub-Saharan African sovereigns to do so — along with a 10-year bond, the Financial Times reported. Meanwhile Egypt is in the market today with a three-tranche deal, offering five-, 10- and 30-year paper. Both deals will be denominated in dollars.

Capital market regulator Sebi will meet credit rating agencies this week to explore ways to have quicker access to information on loan defaults by corporates, The Economic Times reported. With the Reserve Bank of India (RBI) having so far refused to share the sensitive information beyond the banking industry, Sebi is keen that all rating agencies take membership of credit information companies (CICs) to obtain default data that banks have to report to CICs. Many corporates as well as banks are reluctant to share default information with rating agencies.

EU governments intend to build an elite agency to fight the next economic crisis, but they want to shove the European Commission and Parliament to the sidelines, POLITICO reported. Europe’s policymakers agree on the need to upgrade the eurozone’s bailout arm — the European Stability Mechanism (ESM) — into a powerful new European Monetary Fund (EMF). The Council of the EU, however, is trying to use a backdoor procedure to set up the EMF without resorting to the usual EU legislative process, six EU diplomats told POLITICO.

KPMG and other leading accountancy firms face serious questions over their work with failed construction firm Carillion after making millions of pounds out of their relationships with the company, British lawmakers said on Tuesday. Lawmakers from two parliamentary committees examining the collapse of Carillion said that KPMG had earned 29.4 million pounds ($41 million) from auditing the contractor’s accounts since the company was founded in 1999.

Emerging markets trade group EMTA has recommended that bonds issued by Venezuela’s state-owned oil firm PDVSA should be traded “flat”, or without accrued interest, the way bonds in default are typically traded. The move follows a similar advisory from EMTA on Venezuelan sovereign bonds last month and is likely to extinguish any lingering belief that Caracas might try and avoid a default by PDVSA -- the source of 90 percent of Venezuela’s export revenue -- to protect its key oil assets, Reuters reported.

India’s central bank late on Monday tightened its rules around bank loan defaults, seeking to push more large loan defaulters toward bankruptcy courts and abolishing half a dozen existing loan-restructuring mechanisms, in its latest bid to accelerate resolution of the bad loans problem at Indian banks, Reuters reported. The new set of rules are aimed at creating a “harmonised and simplified generic framework” for resolution of stressed assets in view of new bankruptcy regulations, the Reserve Bank of India (RBI) said late on Monday.