Headlines

Brazilian airlines are up in arms over a decision by Brazil’s tax authority to list Ireland as a tax haven, which means about 1 billion reais (€273.7m) in new taxes on aircraft leases for carriers struggling to regain profitability, the Irish Times reported. “The impact is brutal,” said Eduardo Sanovicz, head of Brazilian airline association Abear, who will meet today with tax authorities in Brasilia to try to reverse the surprise tax decision taken without consulting the airline industry.

China’s debt has grown to alarming levels, according to new data from the Bank for International Settlements that highlight a big potential risk to the global economy, the Financial Times reported. What the BIS terms the country’s “credit gap” is now three times higher than the typical danger level, the research shows.

A Brazilian state appeals court postponed on Monday a vote on the legality of several aspects of Grupo OAS SA's restructuring plan for at least a couple of weeks, adding uncertainty to efforts by the debt-laden engineering conglomerate to emerge from bankruptcy protection, Reuters reported. The appeals court in São Paulo agreed earlier in the day to reconvene as early as Oct. 3 to discuss the 19 challenges put forward by a number of local and foreign creditors.

Lost in last week’s news of more Canadian megamergers, Calgary’s Tervita Corp. unveiled a major restructuring that capped off the company’s near decade-long march toward a broken balance sheet, The Globe and Mail reported. As part of the complicated arrangement, the energy services and waste management company will swap its current debt for equity, with secured debt holders getting preferred shares and unsecured debt holders receiving common shares.

A warning indicator for banking stress rose to a record in China in the first quarter, underscoring risks to the nation and the world from a rapid build-up of Chinese corporate debt, Bloomberg News reported. China’s credit-to-gross domestic product “gap” stood at 30.1 percent, the highest for the nation in data stretching back to 1995, according to the Basel-based Bank for International Settlements. Readings above 10 percent signal elevated risks of banking strains, according to the BIS, which released the latest data on Sunday.

Viver Incorporadora & Construtora SA filed for bankruptcy protection on Friday, becoming the first listed Brazilian homebuilder ever to seek an in-court reorganization amid a harsh recession, tough refinancing conditions and slumping home prices, Reuters reported. In a securities filing, Viver said management and advisers, led by Alvarez & Marsal Holdings LLC, filed the request in a commercial court in São Paulo.

South Korea's Hanjin Shipping Co Ltd, whose collapse has disrupted global trade, is considering a restructuring plan to sell more than half its ships, The Wall Street Journal reported on Friday, citing people familiar with the matter. However, liquidation remained the most likely outcome for Hanjin Shipping, the newspaper cited the sources as saying. Hanjin Shipping, the world's seventh-largest container carrier, filed for receivership late last month in a South Korean court and must submit a rehabilitation plan in December.

In a related story, the Yonhap News Agency reported that Korean Air Lines Co., the largest shareholder of the cash-strapped Hanjin Shipping, was unable to decide on Sunday how to provide funding for the nation's leading container shipping line. An official at Korean Air said the company convened an emergency board of directors meeting Sunday to discuss its plan to offer Hanjin Shipping 60 billion won (US$53.3 million) and help ease the cargo crisis triggered by Hanjin's receivership. The meeting was scheduled at the last minute, the official added.

Norway’s central bank is predicted to leave its key policy rate unchanged at a record low as the economy of western Europe’s biggest oil producer fights off the biggest slump in crude prices in a generation, Bloomberg News reported. The central bank will keep its key policy rate at 0.50 percent at a meeting on Thursday, according to 15 of 22 economist surveyed by Bloomberg. Seven predict a cut to 0.25 percent. The bank will likely keep an easing bias to avoid the krone from strengthening too much, according to DNB ASA and Nordea Bank.

Troubled Singaporean oilfield services firm Swiber Holdings said late on Friday it was unable to make the coupon payment for its 450 million yuan ($67.5 million) fixed rate notes due on Sunday. The company applied in July to place itself under judicial management, after initially filing for liquidation, becoming the largest local company to fall victim to the slump in oil prices. Read more.