Headlines

The U.S. Supreme Court handed Argentina a major setback in its long-running battle with a small group of determined creditors, heightening the risk the country will default for the second time in 13 years, The Wall Street Journal reported. The justices on Monday rejected Argentina's appeal of a lower-court ruling that said the country can't make bond payments until it compensates hedge funds that refused to accept restructured debt in the years following Argentina's 2001 default.

Abu Dhabi-based conglomerate Al Jaber Group has signed a debt restructuring deal with its bank creditors, the conglomerate said on Monday, addressing one of the United Arab Emirates' last big debt hangovers from the global financial crisis, Reuters reported. Al Jaber, a family-owned group with operations in aviation, construction and retailing, had been in talks with bank creditors to renegotiate its obligations since 2011. Like many family-owned groups in the Gulf, Al Jaber looked to expand beyond its core business - in Al Jaber's case, construction - during the boom years of the mid-2000s.

The Quebec government is adding its name to a list of creditors seeking money from the insolvent railway company at the heart of the Lac-Megantic train disaster, CTV News reported on a Canadian Press story. The government said Monday that it is seeking $409 million from the Montreal, Maine & Atlantic Railway for expenses incurred and yet to come that stem from the tragedy. The Justice Department said it filed a claim on June 13.

Greece’s creditors will not accept any changes to the core of the country’s streamlining program, only limited peripheral fine-tuning, as is the case during every assessment of the program, according to a top eurozone official in Brussels, ekathimerini.com reported. The two sub-tranches set for the end of May and end-June, each amounting to 1 billion euros, have been linked to six prior actions “whose implementation we are still awaiting,” said the same official.

The UK economic recovery has been dealt a blow after figures showed retail insolvencies have hit an unexpected five-year high and the number of shoppers visiting high streets fell for the second month in a row, The Telegraph reported. Almost 1,300 retailers were declared insolvent during 2013, an increase of 12pc on a year earlier, as rapid expansion of the supermarket convenience store format drove the UK’s cornershops and traditional small retailers to the brink, according to accountancy firm Wilkins Kennedy.

The annual cost of servicing the debt associated with the financial sector bailout in Ireland in 2008 is estimated at about €1.6 billion, according to figures provided by Minister for Finance Michael Noonan, the Irish Times reported. This is from an expected cost of €8 billion to service Ireland’s sizeable national debt this year. The Department of Finance has also estimated that about €41 billion of our national debt is associated with the cost of rescuing the financial sector, said the Minister in a written reply to Fianna Fáil’s finance spokesman Michael McGrath.

The cost of insuring against global bank defaults has plunged to its lowest level since the financial crisis in a sign that investors are willing to bet the industry has become safer, the Financial Times reported. Buyers of bank debt often purchase “credit default swaps,” a type of derivative that helps insure their investments against a default. The price they are paying for that protection is now the lowest since the collapse of Lehman Brothers in September 2008. “We’ve gone back to pre-crisis levels,” said Brian Monteleone, analyst at Barclays.

A judge approved a restructuring plan for Oleo e Gas Participacoes SA, the oil company controlled by Brazilian tycoon Eike Batista, according to a statement by the Rio de Janeiro court that heard the bankruptcy proceedings, Reuters reported. The court's approval grants a quick and expected resolution to the largest bankruptcy in Latin America's history. Creditors of the company, formerly known as OGX Petroleo e Gas Participacoes SA, approved the plan on June 3. Holders of 90 percent of the Rio de Janeiro-based company's nearly 12 billion reais ($5.4 billion) in debt agreed to the plan.

Japanese consumer lender Aiful Corp said on Friday its creditors had agreed with the company's plans to restructure 52.7 billion yen ($517.22 million) of the company's total 162 billion yen in debt, Reuters reported. Aiful will repay the rest of the debt by taking out other loans and will buy back debt from creditors. Conditions on the buybacks were not disclosed, but the company said it will exchange outstanding debt for newly issued bonds that will pay 8 percent and mature in 2020.

Facing the prospect of bankruptcy for the second time in five years, the board of Italy’s troubled flagship airline, Alitalia, agreed on Friday to a strategic partnership that would give a stake of up to 49 percent to the state-owned Abu Dhabi carrier Etihad Airways, the International New York Times reported. With no other viable alternative, and the company’s cash reserves dwindling, Alitalia’s chief executive, Gabriele Del Torchio, told reporters in Rome that the board had voted in favor of Etihad’s offer.