Headlines

China's tightening of rules for consumer finance companies is likely to force consolidation in the roughly $120 billion sector that provides high-interest loans for millions of people shut out of traditional banking, Reuters reported. The National Financial Regulatory Administration (NFRA) announced revamped and stricter rules for the sector on Monday, measures that are expected to drive China's consumer finance companies to seek deeper-pocketed investors or merge.

Turkey’s central bank raised its key interest rate by 5 percentage points on Thursday, resuming a policy of rate hikes aimed at combating soaring inflation that is causing households severe economic pain, the Associated Press reported. In a surprise decision, the central bank said it was raising the benchmark one-week repo rate to 50%. The bank had been widely expected to keep the benchmark rate steady for a second month, ahead of mayoral elections on March 31.

The Swiss National Bank cut its main interest rate by 25 basis points to 1.50% on Thursday, a surprise move which made it the first major central bank to dial back tighter monetary policy aimed at tackling inflation, Reuters reported. The central bank, in the first rate decision since long-serving Chairman Thomas Jordan said he would step down in September, also cut its interest rate on sight deposits to 1.50%.

The Bank of England took another step toward cutting interest rates in the coming months after two of its most ardent hawks dropped their demands for hikes, Bloomberg News reported. Catherine Mann and Jonathan Haskel joined an 8-1 majority on the Monetary Policy Committee to keep rates at a 16-year high of 5.25%, the latest sign that the BOE was edging toward easing policy later this year. That represented the first time since September 2021 that no member of the panel had supported an increase.

Argentina’s economy shrank in the fourth quarter, consolidating a full year of negative growth, even before incoming President Javier Milei slashed spending as part of his shock therapy, Bloomberg News reported. Gross domestic product fell 1.9% compared to the period between July and September, according to official government data published Wednesday. Activity contracted 1.4% from a year earlier, slightly less the median estimate of a 1.5% decline of economists surveyed by Bloomberg.

KCB Group Plc.’s efforts to clean up its loan book of legacy bad debt is being frustrated by government delays in paying suppliers and court injunctions slowing down the sale of collateral to recoup losses, Bloomberg News reported. The Nairobi-based bank with operations across seven African nations posted a 29% jump in gross non-performing loans to 208.3 billion shillings ($1.57 billion) in its full-year earnings.

Some western banks have begun lobbying against EU proposals to redistribute billions of euros in interest earned on frozen Russian assets, senior industry sources said, fearing it could lead to costly litigation, Reuters reported. European Union leaders are on Thursday discussing a plan to use up to 3 billion euros ($3.26 billion) a year to supply arms to Ukraine as they try to bolster Kyiv's fight against Russia, which would still own the underlying frozen assets.

Scandinavian airline SAS said yesterday that a U.S. Bankruptcy Court had approved its chapter 11 reorganization plan, Reuters reported. Bankruptcy Judge Michael Wiles approved SAS AB’s bankruptcy restructuring at a court hearing in Manhattan, clearing the airline to move ahead with a restructuring that includes a $1.2 billion investment from a consortium of bidders, including the Danish government. The deal will provide up to $325 million in value to the airline’s junior creditors through a combination of cash and equity in the reorganized company.

Canada saw a steep rise in insolvencies in 2023, particularly in Q4 and in Ontario and Quebec, and small businesses bore much of the brunt, according to a report from Davies Ward Phillips & Vineberg LLP, CanadianLawyerMag.com reported. Rising by 41.4 percent compared to 2020 and 30.7 percent higher than 2019, the firm said its analysis of business openings, closings, and repayment requirements of government-subsidized loans indicated that smaller businesses largely drove rising filing rates.

An appeals court in Montenegro on Wednesday confirmed that a South Korean mogul known as “the cryptocurrency king” will be handed over to his native country, the Associated Press reported. Both South Korea and the U.S. had requested Do Kwon’s extradition from Montenegro. A Montenegrin court initially decided he should be handed over to the U.S. but that ruling was later overturned in favor of South Korea. The Appeals Court of Montenegro approved an earlier ruling by the High Court to extradite Kwon to South Korea rather than the United States, a statement said.