Headlines

A group made of about 70 different bondholders in Oi SA vowed on Monday to work towards a successful in-court reorganization of Brazil's largest fixed-line phone carrier, Reuters reported. In a statement, the so-called Ad Hoc steering committee that is being advised by Moelis & Co said a letter by distressed debt investor Aurelius Capital Management LP in which it lambasts the Moelis-led group's restructuring proposal prior to Oi's bankruptcy filing is based on "incomplete and erroneous information" about the way Brazilian laws work.

Singapore’s regulator has vowed more “intrusive” inspections of banks over money-laundering after admitting that the scandal surrounding Malaysia’s state investment fund has been a blow to the city-state’s reputation as a financial centre, the Financial Times reported. Banks in Singapore were used to channel money diverted from 1MDB, according to US prosecutors, who allege that more than $3.5bn was siphoned off from the Malaysian state investment fund.

McGrathNicol could go after Dick Smith auditor Deloitte for potential breach of accounting standards after it was appointed as the liquidator of the collapsed electronic retailer, the Financial Review reported. UTS accounting professor Peter Wells said on Monday a close reading of page 48 of the creditors' report suggests some of the rebates were classified as marketing rebates when they should have been classified as inventory rebates to inflate profit for the 2015 financial year.

Hospital equipment supplier Eurosurgical is likely to owe the Revenue Commissioners a substantial sum when the company’s final tax liability is calculated by its liquidator, the Irish Times reported. The High Court recently appointed George Maloney of RSM as liquidator to Dublin-based Eurosurgical, whose main creditor is Revenue, which had issued it with an assessment for €3 million. Mr Maloney is investigating Eurosurgical’s activities over a lengthy period leading up to the court’s decision to place it in liquidation.

The head of a credit fund controlled by Indian billionaire Uday Kotak said the government’s push to rid banks of bad loans will outlast the departure of a central bank governor who battled the problem, Bloomberg News reported today. Reserve Bank of India Governor Raghuram Rajan, who set a deadline for Indian lenders to clean up their soured debt by March 2017, leaves office in early September. The banking industry’s gross bad-loan ratio jumped to a 13-year high of 7.6 percent at the end of March, underscoring a key challenge for the next central bank head.

Shares in Brazil's largest listed banks posted their biggest decline in a month on Thursday on concerns about the financial health of Odebrecht SA, the engineering group that is embroiled in a large corruption scandal, despite a denial by the company that it would seek an accommodation with creditors, Reuters reported yesterday. Odebrecht denied plans to seek an in-court reorganization, as reported yesterday by financial blog Brazil Journal. Ongoing negotiations with banks as well as efforts to sell assets "continue to be positive," the statement said.

New and increased government insolvency fees introduced yesterday will undermine the UK insolvency regime and cost creditors £8m per year, R3 has warned, according to Accountancy Age today. By threatening creditor returns, the government could undermine the UK’s World Bank insolvency ranking, the insolvency trade body said. Among other new fees, the government is introducing a fee of £6,000 in every compulsory liquidation or bankruptcy, even when the case is handled by a private sector insolvency practitioner rather than the government’s official receiver.

Canada’s annual inflation rate rose in June, fueled by higher car and electricity prices, and increased costs associated with housing, the Wall Street Journal reported today. The all-items consumer-price index in June rose 1.5 percent from a year earlier, Statistics Canada said Friday, matching the previous month’s advance. June’s annual core-inflation rate—which excludes volatile components such as some food and energy prices—increased 2.1 percent. The latest reading marks the 21st time in a 24-month period that core consumer prices rose by 2 percent or more.

Mozambique’s central bank raised its key rate by 300 basis points to 17.25 percent, the fourth rate increase this year, as it tries to put a lid on soaring prices in the cash-strapped southern African nation, Bloomberg News reported yesterday. Policymakers also increased the interest rate on the standing deposit facility to 10.25 percent from 7.25 percent, Governor Ernesto Gove said.

Budget deficits for the 19 euro-area governments fell to an eight-year low in the first quarter as the pace of economic growth accelerated, Bloomberg News reported today. The euro area’s seasonally-adjusted budgetary shortfall fell to 1.6 percent of output compared with 2.2 percent in the same period a year ago, the European Union’s statistics agency said in a release published Friday. That is the narrowest shortfall since the first quarter of 2008.