United Kingdom

London's Court of Appeal will hear a request to revive a 5 billion pound ($6.95 billion) lawsuit against Anglo-Australian mining group BHP (BHPB.L), (BHP.AX) over a 2015 dam failure in Brazil, a court order showed, Reuters reported. Judge Nicholas Underhill has agreed to an oral hearing that could help to overturn a previous Court of Appeal decision which denied a 200,000-strong Brazilian claimant group permission to appeal against a judgment to strike out the landmark case.
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The Bank of England unveiled a much brighter outlook for the British economy on Thursday, saying it would return to its prepandemic levels at the end of this year as lockdowns ended, consumers spent billions of pounds in extra savings and the vaccine rollout reduced public health worries, the New York Times reported. The central bank, in its quarterly monetary report, raised its growth forecasts and slashed its predictions for unemployment. The British economy is now projected to grow 7.25 percent this year, compared to a forecast of 5 percent growth three months ago.
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The European Commission accused the U.K. of breaching the post-Brexit trade deal by introducing conditions to grant licenses to fishing boats, Politico reported. London and Paris are at loggerheads over fishing licensing arrangements for French boats fishing in the Channel Islands, but the tension escalated in the last 24 hours when both sides dispatched patrol vessels to the self-governing island of Jersey, where French fishermen had sailed to in protest. French fishermen are struggling to obtain licenses allowing them to keep working in U.K. waters, including in Jersey.
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Liberty Steel Group said on Wednesday that it had appointed a committee to restructure and refinance the group after Greensill Capital, its biggest lender, filed for insolvency in March, Reuters reported. The move comes after Sanjeev Gupta’s family conglomerate GFG Alliance announced that its Australian unit had agreed terms to refinance its exposure to Greensill. Liberty Steel, which is also under the GFG umbrella, said in a statement that four new board directors would form a Restructuring and Transformation Committee (RTC) to focus on fixing or selling underperforming units.
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While the drama of Greensill’s collapse is unfolding in financial centers like London and Zurich, and has sparked a scandal at the top of British politics, blue-collar towns could face the worst consequences if GFG fails to refinance, the Wall Street Journal reported. GFG employs about 35,000 people, mainly in economically deprived parts of Europe, Australia and the U.S., with some sites at risk of closure if Sanjeev Gupta doesn’t secure new finance and governments don’t step in.
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Company insolvencies in England and Wales fell to their lowest level in more than thirty years during the first three months of this year, as government support measures helped businesses hit by the pandemic to ward off bankruptcy, the London Times reported. Britain suffered its sharpest fall in economic output in more than three centuries last year, but government-backed lending schemes enabled companies to borrow more than £75 billion to navigate cashflow problems.
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It was a flashpoint in the world of distressed investing: Sanjeev Gupta’s infamous metals empire was falling apart as Greensill Capital imploded, Bloomberg reported. As turnaround specialists sought to grab debt of one his key assets on the cheap, a single U.S. private-equity firm swooped in to buy up the lion’s share — at full price. While the supply-chain saga has sparked a lobbying scandal in the U.K. political establishment, for troubled credit creditors it shows the everyday challenges of deploying the $15 billion lying idle in distressed funds.

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Shares rose in early European trading on Friday after retreating in Asia as the latest batch of economic data provided mixed signals about prospects for the recovery from the pandemic, the Associated Press reported. Two surveys showed Chinese manufacturing expanded in April but growth appeared to be slowing. Figures showed Europe’s economy contracted in the first three months of the year, while the U.S. economy steamed ahead, growing at a 6.4% annual pace.

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Fewer people are defaulting on loans due to the pandemic than expected, two major banks have said and the BBC reported. NatWest Group, which owns RBS, was able to release £102m it had set aside for bad loans in the first quarter after "better than expected" repayments. Standard Chartered meanwhile took a $20 million hit from bad loans in the same period — down by $354 million from the previous quarter. Earlier this week, HSBC and Lloyds both reported a similar trend.

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