Hungary’s new central bank president Gyorgy Matolcsy has unveiled a new 250bn forint (€831m) lending plan which allows banks to borrow at zero per cent from the central bank.
The banks can then lend to businesses with the funds at a maximum 2 per cent rate of interest, a measure aimed at getting loans to small and medium-sized businesses to help them replace their foreign currency loans with forint loans. The forint initially depreciated on Thursday, to around 303.8 to the euro, before reversing to around 300.6 to the euro at 1pm CET, an appreciation of 0.6 per cent. Continue reading »
Luxurious homes around the world, highly collectable cars, a stud farm, some very classy yachts famous for their “king sized parties”… Anyone would be happy to get their hands on Vijay Mallya’s assets.
Now that his creditors have run out of patience and are calling in loans to Mallya’s Kingfisher Airlines, some of them bearing the billionaire tycoon’s personal guarantee, you’d think a few of these playthings might be about to change hands. Well, maybe just a few… Continue reading »
By David Creighton of Cordiant Capital
With record flows into emerging market bonds you could be forgiven for thinking growth economies were awash with credit, and that they had avoided the fallout from the eurozone crisis.
Unfortunately this is not the case. The benefits of the boom in EM bonds have not been evenly spread. Not only is issuing bonds an option available uniquely to the very largest class of emerging market enterprises, but these bond issuers are generally concentrated within limited geographies like Brazil, China and Russia, and in the energy, mining and telecom sectors. Continue reading »
When it comes to loans, Africa has a clear preference: lots from China, a little less from the World Bank please.
According to data compiled by rating agency Fitch, loans from China’s Exim bank to Africa in 2011 were double that of the World Bank, cementing a trend which started around 2005. Continue reading »
On Thursday, State Bank of India and HDFC bank agreed to loan Tata Steel and Hindalco Industries around $6.6bn and $1.9bn, respectively – a development that may suggest the Indian economy, after a rough 18 months, is in for a turnaround.
Two big loans don’t make an Indian summer – but greater access to loans would help smaller businesses a great deal. The SME Rating Agency of India has noted that greater access to liquidity from banks – sometimes at the lowest interest rates in the last decade – has caused Indian SME ratings to improve over the past couple months. Continue reading »
Short-term online loans company Wonga, based in London, has opened for business in South Africa, the home of its founders Errol Damelin and Jonty Hurwitz. The UK business has generated a lot of headlines, both good and bad.
The company has just launched a new business service in the UK – with the usual debates over the high level of interest levied (The men who made £50 million from other people’s cash woes is one typical example). So will the South African arm cause the same angst? Continue reading »
Bahrian’s Arcapita bank has thrown creditors a bit of a curve ball. The bank has decided to file for bankruptcy protection in the US after talks over an upcoming bank maturity of $1.1bn on March 28 broke down.
It’s the first time a Gulf company has sought Chapter 11 refuge in US courts, and creates a new level of public scrutiny for the bank – as well as an uncertain outcome for those wanting their money back. Continue reading »
Give credit where it’s due. That’s the latest policy from Vietnam’s central bank to try to resolve the deep-seated problems in the banking sector.
Years of rapid credit growth have led to persistently high inflation and rising bad debts in the corporate sector. Last year, the State Bank of Vietnam, the central bank, introduced a 20 per cent cap on credit growth for every bank, in an attempt to stabilise the financial system. This year the SBV has opted for differential credit growth limits, depending on the respective strength of the financial institution. Continue reading »
The growth of non-performing assets on the balance sheets of Indian banks has been a huge concern for investors over the last year – so much so that analysts cite it as a major reason the Bombay Stock Exchange’s banking index fell 31.6 per cent in 2011.
But there’s one player that doesn’t seem all that concerned about it: the Reserve Bank of India. Continue reading »
Asian companies are worried about the unfolding eurozone crisis, but few are doing much about it beyond hoarding cash, according to a new survey from Citigroup.
Most companies in Asia have been increasing their cash levels or liquidity, and a quarter have shifted bank deposits to diversify risk. But 80 per cent have not planned for a eurozone break-up – deeming it either too unlikely or too difficult to plan for. Continue reading »
Brazil’s central bank has released figures for October showing the highest vehicle loan default rate in two years. As reported by Bloomberg:
Default rates on cars, motorcycles and trucks in October rose to 4.7 per cent, the highest since September 2009, compared with 3.1 per cent a year earlier and 4.4 per cent in September, the central bank said Nov 23. Loans that were 15 to 90 days overdue increased to 8.6 per cent from 7.9 per cent a month ago.
Continue reading »