Hong Kong

Genting Hong Kong, one of the territory’s leading cruise ship operators, has halted payments on debts of almost $3.4bn in the latest financial blow for an industry that has been devastated by the coronavirus pandemic, the Financial Times reported. The company, controlled by Malaysian billionaire Lim Kok Thay, said on Wednesday evening that it would “temporarily suspend all payments to the group’s financial creditors” and seek to restructure its debt.

Pick five of the worst affected businesses by the pandemic, then put them in a portfolio. That neatly sums up the storied Hong Kong conglomerate Swire Pacific. The businesses of the two-century-old British-controlled hong, including airlines, commercial real estate, hotels and marine services, have suffered, the Financial Times reported in a commentary. Once one of the largest constituents in the Hang Seng index, today it is the smallest. Swire — Taikoo in Cantonese — reported a net loss of HK$7.7bn ($1bn), its first half-yearly loss in more than a decade.

Wigan Athletic’s former owner has said projected losses forced him to sell the club to the Hong Kong businessman who plunged it into administration just weeks after completing the purchase, the Financial Times reported. It is the first time Stanley Choi, who controls International Entertainment Corporation, a Hong Kong-listed hotel and casino operator, has spoken about his role in the sale process that preceded the club’s collapse, which has provoked fierce scrutiny of foreign ownership of English clubs.

Bankruptcy filings in Hong Kong rose to a 17-year high, records showed on Friday, as the coronavirus pandemic dealt a heavy blow to the businesses following months of social unrest, Reuters reported. There were 2,079 petitions presented last month, Official Receiver’s Office said, the highest since May 2003. The figure came as the city’s unemployment rate rose to 5.9% in the March to May period, the highest in more than 15 years. The number of compulsory winding-up filings stood at 68 in May, the highest since July 2009.

NWS Holdings Ltd., a unit of one of Hong Kong’s biggest property developers New World Development Co., has applied for a license to manage distressed loans in China, according to people familiar with the matter, Bloomberg News reported. NWS has submitted the application to the China Banking and Insurance Regulatory Commission for a permit in southern Hainan province, said the people, who asked not to be identified as the matter is private.

Financially battered Hong Kong airline Cathay Pacific Airways has become the latest airline to resort to government support to survive the coronavirus pandemic, the International New York Times reported on an Associated Press story. The Hong Kong government on Tuesday approved a 39 billion Hong Kong dollar ($5 billion) recapitalization plan that calls for a new government-controlled entity called Aviation 2020 to buy $2.6 billion of an up to 33 billion Hong Kong dollars ($4.3 billion) share offering by Cathay Pacific.

A Hong Kong-listed oil explorer became the first casualty of the spectacular oil price slump in China’s offshore bond market, after defaulting on a dollar note, Bloomberg News reported. MIE Holdings Corp. failed to deliver an interest repayment of about $17 million for its 13.75% dollar bond due 2022 after a 30-day grace period expired Monday, according to a filing to the Hong Kong stock exchange. This triggered cross defaults on other loan facilities, it said.

With plenty of Hong Kong companies on their last legs, landlords, suppliers and other creditors are eager to collect on unpaid bills, Bloomberg News reported. For three months, there’s been no relief: the court that presides over failing businesses has been effectively closed. Now, with the court scheduled to resume Monday, lawyers and restructuring experts are expecting a flood of unhappy lenders to ask for a forced liquidation of hundreds of small- and medium-sized businesses in the city.

Hong Kong’s retail sales fell by a record 44% in February from a year earlier, as travel restrictions kept tourists away and residents avoided shopping centres to prevent the spread of the coronavirus, Reuters reported. The spending drought has hit an economy already in recession after months of often-violent anti-government protests. Retail sales in February fell 44% from a year earlier to HK$22.7 billion ($2.93 billion), compared with a revised 21.5% drop in January, government data showed on Tuesday.

Hong Kong plans to introduce its version of U.S.-style “Chapter 11” bankruptcy provisions, a senior government official said, as the city’s worst economic predicament in decades threatens the viability of many companies, Reuters reported. Hong Kong does not have a formal corporate rescue framework, unlike most other major financial centers including fierce rival Singapore, after previous attempts to introduce one met with resistance from lawmakers and labor representatives who were worried plans did not offer enough protection for workers.