Cash – Indigo Dreams http://indigodreams.net/ Sat, 05 Jun 2021 00:01:45 +0000 en-US hourly 1 https://wordpress.org/?v=5.7.2 https://indigodreams.net/wp-content/uploads/2021/04/default1.png Cash – Indigo Dreams http://indigodreams.net/ 32 32 Greensill Capital’s funding crisis could lead to losses for insurers and banks: analysis https://indigodreams.net/greensill-capitals-funding-crisis-could-lead-to-losses-for-insurers-and-banks-analysis/ Tue, 09 Mar 2021 10:56:45 +0000 https://indigodreams.net/greensill-capitals-funding-crisis-could-lead-to-losses-for-insurers-and-banks-analysis/ LONDON – A funding crisis at Greensill Capital could impact some of its high-risk borrowers and lead to losses for insurers and banks who have done business with the UK-based supply chain finance company if its customers default, according to several industry experts and a review of public documents. Greensill, backed by Softbank Group Corp’s […]]]>

LONDON – A funding crisis at Greensill Capital could impact some of its high-risk borrowers and lead to losses for insurers and banks who have done business with the UK-based supply chain finance company if its customers default, according to several industry experts and a review of public documents.

Greensill, backed by Softbank Group Corp’s Vision Fund, helps businesses allocate the time they have to pay their bills. The loans, which typically have maturities of up to 90 days, are securitized and sold to investors, allowing Greensill to issue new loans.

“Any inability of borrowers to pay could, in turn, result in losses for credit insurers who sold default protection on Greensill securities purchased by Credit Suisse funds.”

Earlier this week, Greensill’s main source of funding came to a screeching halt. Swiss bank Credit Suisse Group AG and asset manager GAM Holdings AG have suspended buybacks of funds that held most of their approximately $ 10 billion assets in Greensill notes. Credit Suisse said it was concerned it could assess them accurately, while GAM cited “media coverage related to supply chain finance.”

[Editor’s note: Reuters made a clarification on March 5th that GAM Holdings’ closure of the fund related to concerns about perceptions of supply chain finance rather than about asset valuations].

Greensill is preparing to file for bankruptcy and is also in talks to sell much of its business to private equity firm Apollo Global Management Inc, a source close to Greensill said on Wednesday. But Apollo has no plans to bail out Greensill’s borrowers and is unwilling to even provide loan services to Greensill’s riskier clients, two sources close to the talks said due to financial and reputational risks.

Although Greensill did not name Apollo, he confirmed on Tuesday that he was in talks with “a leading global financial institution” to buy his business. Apollo, Softbank and Credit Suisse declined to comment.

The uncertainty as to what will happen over the next few days could spill over to customers of Greensill and other financial institutions.

For the company’s clients, an inability by Greensill to continue funding them may mean having to pay off debt quickly and find other sources of short-term funding, according to four experts in short-term inventory-backed finance – or “Supply chain” of the type proposed by Greensill.

This could be particularly problematic for its high-risk clients, who may find it difficult to raise funds elsewhere or have to pay significantly more for financing.

“If you only have one source for this type of capital, you may have to scramble,” said Craig Jeffrey, of the Atlanta-based consultancy Strategic Treasurer, which advises clients on financing. of the supply chain.

Any inability of borrowers to pay could, in turn, result in losses for credit insurers who sold default protection on Greensill securities purchased by Credit Suisse funds. And if those insurers don’t pay, investors could sue Credit Suisse to cover their losses, said Thorsten Beck, professor of finance at the University of London. Morgan Stanley analysts this week said in a research note that even if the Swiss bank did not suffer direct financial losses, it would suffer reputational damage from the crisis.

In addition, a bank owned by Greensill in Germany, which keeps the company’s short-term loans on its balance sheet before they are securitized and sold to Credit Suisse, could also incur losses if the sudden withdrawal of credit results in payment defaults. on the debts it held temporarily, according to the staff reports and the published accounts.

German financial regulator Bafin filed a criminal complaint against Bremen-based bank Greensill on Wednesday, claiming the lender was unable to provide proof of the debts it said it purchased from the finance group of GFG Alliance metals.

In a statement to Reuters, Greensill Capital spokesman James Doran said talks were underway with a suitor over a deal for parts of his business that could help preserve operations and jobs. “While the structure of the new business is still being worked out, we anticipate that the transaction will ensure that the majority of Greensill’s clients will continue to be funded in the same way they are currently while preserving a substantial number. jobs. “

Greensill Bank “always seeks external legal and audit advice before reserving a new asset,” added Greensill Capital. He declined to comment on Bafin’s specific claim. GFG did not respond to requests for comment on Greensill Bank.

Supply chain model

The supply chain loan model is generally viewed as a relatively low risk investment. But Greensill, formed in 2011 by former Citigroup banker Lex Greensill, has taken on some heavily indebted clients, as publicly available accounts for borrowers show. He also loaned money to finance fixed assets such as buildings and factories, which are typically funded by longer-term funding, according to the accounts, while supply chain funding typically covers debts. short term such as payment for inventory.

One of its biggest clients is GFG, run by Indo-British metal magnate Sanjeev Gupta. GFG Alliance had to pay an interest rate of 12% when it issued debt on the public markets in 2019.

But Greensill said his company typically provided loans to businesses for around 4%, and could do so because investors would accept low returns as he made sure debts were secured by assets that would be quickly realized.

Reuters was unable to find out the specific rate Greensill charged GFG and how much of Credit Suisse and GAM fund assets are represented by GFG loans. Past accounts of the funds and companies involved show hundreds of millions of dollars in outstanding credit at all times.

GFG Alliance spokesman Andrew Mitchell said the group had alternative funders in Greensill.

“GFG Alliance has adequate current funds and its plans to bring in new capital through refinancing are progressing well,” he said, adding that troubled companies bought by GFG were recovering and generated positive cash flow.

German exhibition

Any customer default could also impact Greensill Bank in Bremen, Germany, according to a review of credit reports and published accounts. The bank’s exposure to GFG is unclear, but its latest information on capital requirements shows that in 2019 it took over $ 1 billion in exposures in Macedonia, the Czech Republic and in Romania, after GFG started operating in these countries.

Greensill Bank is largely funded by around € 3 billion in deposits and depositors are protected by the bank’s membership in the Deposit Protection Fund of the Federal Association of German Banks.

Greensill Bank declined to answer questions about its finances and neither it nor Credit Suisse is disclosing its exposure to individual companies.

Any loss suffered by Credit Suisse funds could also be passed on to more than one party. Credit insurers sold the Credit Suisse funds and the Greensill protection against defaults on the Greensill securities purchased by the funds. While Greensill Capital is responsible for the initial losses on funds to the tune of $ 1 billion, accounts show insurers are covering much of the rest, Credit Suisse said in January.

Credit Suisse declined to confirm whether the debts currently in the fund are covered by insurance and who covered them.

Credit Suisse is also Greensill’s creditor. The Zurich-based bank has $ 140 million in outstanding loans to the company, a source familiar with the matter said.

Greensill declined to say whether the sale talks contemplate the potential buyer taking over debts or those held by Credit Suisse funds. Credit Suisse declined to comment on the debt.

(Additional reporting by Abhinav Ramnarayan and Carolyn Cohn in London and Brenna Hughes Neghaiwi in Zurich; editing by Paritosh Bansal and Edward Tobin)

The subjects
Mergers Operators Loss of profits

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Ally Mortgage Review | Ascension https://indigodreams.net/ally-mortgage-review-ascension/ Tue, 09 Mar 2021 10:56:45 +0000 https://indigodreams.net/ally-mortgage-review-ascension/ Best benefits Quickly find the right loan: You will get a personalized quote after answering a few simple questions and a pre-approval letter to include with your home offer after just three minutes. Ally provides a table showing the different types of loans, possible interest rates and monthly mortgage payments so you can decide at […]]]>

Best benefits

Quickly find the right loan: You will get a personalized quote after answering a few simple questions and a pre-approval letter to include with your home offer after just three minutes. Ally provides a table showing the different types of loans, possible interest rates and monthly mortgage payments so you can decide at a glance what is right for you.

Fully digital process: While loan officers are available by text or phone if you need help, you can apply and submit all of your financial documents online.

Low down payments and homebuyers’ programs: You can make as low as 3% down and save on private mortgage insurance with Fannie Mae’s HomeReady loan option.

What could be improved

Limited options for low credit: Ally does not offer many mortgage options for borrowers with low credit scores. Notably, the lender does not provide VA, FHA, or USDA loans which usually come with less restrictive eligibility conditions because they are government insured.

Original costs: Ally Mortgage also charges an origination fee, which is an upfront fee that some lenders do not charge. And at $ 995, that’s higher than many competitors’ fees. You will need to take this into account when you compare mortgage rates to see who has the best overall deal.

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Extreme weather events put $ 84 billion in Indian bank debt at risk https://indigodreams.net/extreme-weather-events-put-84-billion-in-indian-bank-debt-at-risk/ Tue, 09 Mar 2021 10:56:45 +0000 https://indigodreams.net/extreme-weather-events-put-84-billion-in-indian-bank-debt-at-risk/ An increase in extreme weather events such as floods, droughts and cyclones threatens to worsen debt worth more than Rs.619 trillion ($ 84 billion) at India’s largest financial institutions. That’s according to leading nonprofit environmental disclosure platform CDP. The State Bank of India, the country’s largest lender, HDFC Bank, IndusInd Bank Ltd. and Axis Bank […]]]>

An increase in extreme weather events such as floods, droughts and cyclones threatens to worsen debt worth more than Rs.619 trillion ($ 84 billion) at India’s largest financial institutions.

That’s according to leading nonprofit environmental disclosure platform CDP. The State Bank of India, the country’s largest lender, HDFC Bank, IndusInd Bank Ltd. and Axis Bank Ltd. are among the institutions that reported climate risks to CDP in 2020, she said in her annual report released on Wednesday.

Banks have reported exposure to environmentally sensitive companies including cement, coal, petroleum and power. They also listed the effects of cyclones and floods on loan repayments in agriculture and related sectors. Lenders accounted for 87% of the total risk, valued at around $ 97 billion, at 67 large Indian companies that responded to the CDP.

“The climate is the biggest risk for businesses in the long run. Financial institutions are starting to understand this, ”said Damandeep Singh, director of New Delhi-based CDP India. “As investors seek to fund companies based on environmental, social and governance disclosures, we have seen many other companies reporting climate change risk. “

The potential damage to agriculture echoes concerns expressed by India’s central bank about the impact of climate change on agriculture, a sector that employs more than half of its citizens. At the same time, the world’s third-largest emitter of greenhouse gases is relying on coal to help its post-Covid recovery. The dirtiest fossil fuel could remain its dominant energy source for decades to come.

The CDP, which collected the data on behalf of 515 investors with $ 106 trillion in assets, said it received responses from 220 large and small Indian companies.

The State Bank of India, which is facing concerns from shareholders and investors over its proposal to help finance the controversial Carmichael coal mine in northern Australia, has put its total climate risk at 3.83 trillion of rupees. The bank said it could “indirectly face reputational risks if it were involved in lending to environmentally sensitive projects that could meet significant public opposition.” SBI did not respond to a request for comment.

The second highest risk was reported by HDFC Bank, which estimated it had Rs 1.79 trillion in assets at risk, a 24% increase from 2019. It said its calculations held into account the indemnities it should pay to employees in the event of a flood. and its exposure to agriculture, cement, coal, petroleum and electricity.

Small private banks IndusInd, Axis and Yes reported a decrease in climate change risk from last year to Rs 466 billion, Rs 75 billion and Rs 20 billion respectively, citing more diversified portfolios.

India was second in the Asia-Pacific region and sixth globally in the CDP’s ranking of countries whose companies have committed to science-based net zero carbon emissions targets, according to the report. More than 50 Indian companies have said they are preparing for future policy and regulatory changes by making a voluntary commitment to reduce their carbon footprint.

Increased investor pressure and stricter disclosure standards are forcing Indian companies to address climate concerns, according to the CDP report. Almost all companies reported board-level oversight of climate-related issues, while 84% said climate-related risks and opportunities caused them to change their plans for products and services.

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Building networks is not enough to expand rural broadband https://indigodreams.net/building-networks-is-not-enough-to-expand-rural-broadband/ Tue, 09 Mar 2021 10:56:44 +0000 https://indigodreams.net/building-networks-is-not-enough-to-expand-rural-broadband/ Public subsidies for building rural broadband networks may not be enough to bridge the digital divide, according to a new study from Cornell. High operation and maintenance costs and low population density in some rural areas result in prohibitive service charges, even for a subscriber-owned cooperative structured to prioritize member needs over profit, a revealed […]]]>

Public subsidies for building rural broadband networks may not be enough to bridge the digital divide, according to a new study from Cornell.

High operation and maintenance costs and low population density in some rural areas result in prohibitive service charges, even for a subscriber-owned cooperative structured to prioritize member needs over profit, a revealed the analysis.

Decades ago, co-operatives were essential to the expansion of electricity and telephone services in underserved rural areas, spurred by New Deal legislation offering low-interest government grants and loans. Public financing of rural broadband access should also take into account its critical role in supporting economic development, health care and education, said Todd Schmit, MS ’94, Ph.D. ’03, Associate Professor at the Charles H. Dyson School of Applied Economics and Management.

“The Broadband New Deal needs to integrate more than just building systems,” Schmit said. “We need to think more holistically about the importance of getting equal access to these technologies. “

Schmit is the co-author with Roberta severson ’81, MPS ’05, an extension associate at Dyson, from “Exploring the Feasibility of Rural Broadband Co-operatives in the United States: The New New Deal?The research was published Feb. 13 in Telecommunications Policy.

More than 90% of Americans had broadband access in 2015, according to the study, but the total in rural areas was less than 70%. Federal programs have sought to close this gap, including a $ 20.4 billion Federal Communications Commission initiative announced last year to subsidize the construction of networks in underserved areas.

Schmit and Severson investigated the feasibility of creating a rural broadband cooperative to improve access in Franklin County, upstate New York, which received funding for a feasibility study of the Rural Business Development Program of the United States Department of Agriculture.

The researchers partnered with Slic Network Solutions, a local Internet service provider, to develop estimates of market prices, cost of building a fiber-to-the-home network, operating and maintenance costs. and the potential subscriber base – around 1,600 residents – and model a cooperative that would be profitable over a 10-year cycle.

Federal and state grants and member investments would cover almost all of the estimated $ 8 million construction cost, so this was not a significant factor in the analysis, the researchers said.

But even with those subsidies, the study determined that the co-op would need to charge $ 231 per month for its high-speed service option, which is 131% more than market rates. At this price, it’s unlikely that 40% of year-round residents would opt for broadband as the model had assumed, casting further doubt on its feasibility.

The $ 231 fee included a surcharge to subsidize a low-speed service option costing no more than $ 60 – a restriction imposed by construction subsidies to ensure affordability. Without this restriction, the price of high speed would drop to $ 175 and low speed to $ 105.

In short, write the authors, grants alone covering investment and construction of equipment do not solve the problem of rural broadband, at least in our study area.

As an alternative – although not available in Franklin County – Schmit and Severson examined the possibility of a rural electricity or telecommunications cooperative expanding to broadband. They would become more efficient compared to the infrastructures already in operation, such as the poles that would transport the fiber lines. In this scenario, the price of broadband rose to $ 144 per month, still 44% above market rates.

“These systems are very expensive to operate and maintain,” Schmit said, “especially in areas like the ones we looked at that are very low in density”.

Feasibility improves with growth in the density of a coverage area and the “subscription rate,” or the percentage of potential subscribers signing up at different speeds, depending on the analysis. But in Franklin County, researchers determined that a startup co-op would need 14 potential subscribers per mile to break even over 10 years, more than double the actual density of the study area.

To better serve these areas, Schmit and Severson said, policymakers should consider eliminating property taxes on broadband infrastructure and payments to lease space on poles owned by regulated utilities, which respectively accounted for 16 % and 18% of the annual expenses of the proposed cooperative. The measures reduced the high-speed fees of a growing utility co-op to 25% above market rates, a level members might be willing to pay, the authors said.

“Considering the public benefits of broadband access arguably needs to be added to the equation,” they wrote. “The case was made for electric and telephone services in the 1930s and similar arguments seem to hold for this technology today.”

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New legislation would help cash-strapped commercial property owners https://indigodreams.net/new-legislation-would-help-cash-strapped-commercial-property-owners/ Tue, 09 Mar 2021 10:56:44 +0000 https://indigodreams.net/new-legislation-would-help-cash-strapped-commercial-property-owners/ Lawmakers on Wednesday introduced a bill to provide cash to ailing hotels and malls that were unable to withhold mortgage payments after the the coronavirus has shut down the US economy. The bill would create a government-backed financing vehicle that businesses could use to stay on top of their mortgages. In particular, it aims to […]]]>

Lawmakers on Wednesday introduced a bill to provide cash to ailing hotels and malls that were unable to withhold mortgage payments after the the coronavirus has shut down the US economy.

The bill would create a government-backed financing vehicle that businesses could use to stay on top of their mortgages. In particular, it aims to help those who have borrowed in the market for $ 550 billion for mortgage loans conditioned as bonds and sold on Wall Street.

Many of these business owners struggled to get mortgage relief after the coronavirus forced them to close or reduce, which exposes them to a greater risk of seizure. About 10% of the loans of these commercial mortgage-backed securities were 30 days or more past due at the end of June, including nearly a quarter of loans related to the hard-hit hospitality industry, according to Trepp LLC. .

“The numbers are getting more dire and the projections are getting tougher,” said Rep. Van Taylor (R., Texas), who is sponsoring the bill alongside Rep. Al Lawson (D., Florida). .

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The proposal is an effort to help a corner of the financial markets that many business owners and trade groups believe was left behind when the federal government began to put in place measures to allow owners and businesses to suspend the market. payment of their debts.

CMBS borrowers, especially in the hospitality industry, say they have been unlucky in getting relief on their loans. They usually have to work with special administrators, who are hired by bondholders to negotiate on their behalf and comply with rigid loan provisions. They were slower and less generous than traditional bank lenders, said the borrowers.

Representatives of service agents said the relief process was complex and managing agents would not foreclose properties without first having a conversation with borrowers.

Under the proposal, the banks would allocate money to help these borrowers and the facility would provide a Treasury Department guarantee that the banks are repaid. The funding would come from a $ 454 billion pot set aside for struggling businesses in the previous stimulus bill.

Richard Pietrafesa owns three hotels on the East Coast which have been funded by CMBS loans. They recently had about 50% or less occupancy, which doesn’t bring in enough income to make mortgage payments, he said.

He said he was two months behind on payments for one of his properties, a Fairfield Inn & Suites in Charleston, SC. ​​He has money set aside in a separate reserve, a- he said, but his special agent did not allow him access. make debt payments.

“It’s like a prison for debtors,” said Pietrafesa.

Any troubled business borrower who was previously in good financial health would be eligible to apply for funds to cover mortgage payments. The facility, however, is designed specifically for CMBS borrowers.

Many of these borrowers have provisions in their initial loan documents that prohibit them from taking on more debt without additional approval from their managers.

Rather, the proposed facility would structure the cash injections into preferred shares, which are not subject to debt restrictions.

Senior equity would be considered lower than other debt, but must be repaid with interest before the owner can withdraw money from the business.

Mr Taylor led a bipartisan group of more than 100 lawmakers who signed a letter last month asking the Federal Reserve and the Treasury Department to propose a solution to CMBS problems.

Treasury Secretary Steven Mnuchin and Fed Chairman Jerome Powell have indicated that this issue may be the one best addressed by Congress.

Some in the industry have said that efforts to help the CMBS market disproportionately benefit a handful of large property owners, rather than small business owners.

Mr Taylor said the bill is focused on saving jobs. The hospitality industry, for example, is responsible for much of the recent job cuts.

“It started with the people in my district calling and saying, ‘I lost my job,’” Taylor said.

Write to Ben Eisen at ben.eisen@wsj.com

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OPEC Fund supports post-COVID-19 African infrastructure with $ 50 million loan to African Finance Corporation https://indigodreams.net/opec-fund-supports-post-covid-19-african-infrastructure-with-50-million-loan-to-african-finance-corporation/ Tue, 09 Mar 2021 10:56:43 +0000 https://indigodreams.net/opec-fund-supports-post-covid-19-african-infrastructure-with-50-million-loan-to-african-finance-corporation/ VIENNA – (BUSINESS WIRE) – The OPEC Fund for International Development (the OPEC Fund) and the African Finance Corporation (AFC) signed a $ 50 million loan agreement to help finance and build the infrastructure necessary for the post-COVID recovery of Africa. This is the first direct financial cooperation between the two institutions. The proceeds from […]]]>

VIENNA – () – The OPEC Fund for International Development (the OPEC Fund) and the African Finance Corporation (AFC) signed a $ 50 million loan agreement to help finance and build the infrastructure necessary for the post-COVID recovery of Africa. This is the first direct financial cooperation between the two institutions.

The proceeds from the 10-year loan to AFC will help close the continent’s well-known infrastructure financing gap. The loan will also support increased financial flows to Africa and contribute to COVID-19 recovery efforts in African economies by freeing up government funds to meet urgent financing needs related to the pandemic.

AFC President and CEO Samaila Zubairu said: “AFC has engaged development partners around the world to find ways to act together to mobilize the necessary funds for post-pandemic recovery. ‘Africa and optimize its effective deployment. This loan is part of AFC’s effort to support vital infrastructure for development, from energy to transport and trade, and to put Africa back on the path to sustainable growth and development. We are committed to working with the OPEC Fund and other partners as essential catalysts for the development of critical infrastructure. ”

OPEC Fund Director General Dr Abdulhamid Alkhalifa said: “The urgent infrastructure financing needs in Africa have become even more pronounced since the onset of COVID-19. The pandemic has hampered economic growth and investment across the continent. Our support to AFC will help provide sustainable financing for infrastructure development to improve connectivity, transport, logistics, trade and job creation. We look forward to a long and productive partnership with AFC. By working with experienced regional partners, our development impact is amplified. ”

AFC is a financial institution of 28 member countries, established to provide private sector-focused and financing solutions for infrastructure, natural resources and industrial projects across Africa. To date, AFC has invested more than US $ 8.4 billion in projects in 35 African countries. The OPEC Fund signed a cooperation agreement with the AFC in 2017 and this loan marks the start of collaboration in the field.

About the OPEC Fund

The OPEC Fund for International Development (the OPEC Fund) is the only globally mandated development institution that provides funding from member countries to non-member countries. The organization works in cooperation with developing country partners and the international development community to drive economic growth and social progress in low- and middle-income countries around the world. The OPEC Fund was established by OPEC member countries in 1976 with a distinct mandate: to stimulate development, strengthen communities and empower people. Our work is people-centered and focuses on financing projects that meet basic needs, such as food, energy, infrastructure, employment (especially for MSMEs), clean water and sanitation, health care and education. To date, we have approved more than US $ 25 billion for operations in 135 partner countries. Our vision is a world where sustainable development is a reality for all.

About Africa Finance Corporation

AFC was established in 2007 to be the catalyst for private sector led infrastructure investments across Africa. It is the second highest rated multilateral financial institution in Africa. AFC’s approach combines specialized industry expertise with a focus on financial and technical advice, project structuring, project development and venture capital to meet the infrastructure development needs of the Africa and stimulate sustainable economic growth. AFC invests in high quality infrastructure assets that provide essential services in the basic infrastructure sectors of energy, natural resources, heavy industry, transport and telecommunications. To date, the Company has invested over US $ 8.4 billion in projects in 35 African countries. www.africafc.org

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The Democrats’ big tent helped them win. Now this threatens Biden’s agenda. https://indigodreams.net/the-democrats-big-tent-helped-them-win-now-this-threatens-bidens-agenda/ Tue, 09 Mar 2021 10:56:43 +0000 https://indigodreams.net/the-democrats-big-tent-helped-them-win-now-this-threatens-bidens-agenda/ Mr. Sanders aimed at the recent news that Third Way, a moderate think tank that has often pushed Democrats to the center, was working on a project to examine the party’s performance in 2020 and make recommendations for midterms 2022. He said issues such as canceling student debt, raising the minimum wage to $ 15 […]]]>

Mr. Sanders aimed at the recent news that Third Way, a moderate think tank that has often pushed Democrats to the center, was working on a project to examine the party’s performance in 2020 and make recommendations for midterms 2022. He said issues such as canceling student debt, raising the minimum wage to $ 15 an hour and tackling climate change were “political winners”.

Today’s American working class – white, black, Latino – is suffering. They want us to react vigorously, ”he said. “If we do, I think they’ll reward us in 2022. If we fail them, Republicans will be able to say, ‘Hey, you gave these people the House, the Senate, and the White House and they got nothing.’ made. for you, “we will not do well in 2022.”

Yet the entrenchment by moderate senators – and the president’s current deference to him – presents a challenge for activists hoping to sway the administration. And while progressive elected officials are confident that Mr. Biden will eventually join them, a growing chorus of activists are looking to him for more immediate action.

K Trainor, a student activist who has worked with progressive groups to train Democratic students, said Mr Biden’s response to mayor was deeply disappointing. She said if the administration ignored young voters, it would be more difficult to persuade them to participate in future elections.

“I think a lot of people in my generation ask, ‘Where’s the courage? ”Ms. Trainor said. “It feels like they’re going backwards and we’re not even 100 days away.”

Reverend William J. Barber II, co-chair of the Campaign of the Poor who organized the meeting of West Virginia workers with Mr Manchin, said the debate reflected an ugly belly of Democratic politics. While the working poor and low-income, especially those who are racial minorities or young people, form the core of the Democratic base, he said, the policies that interest them most have often been sacrificed due to political calculations.

They represent the human cost of the big tent, he said.

“The Democrats ran on it, they put it in their platform and they said that’s what has to happen,” Dr Barber said. “It would be the ultimate surrender and betrayal to then get here and have the power to do it and then step back.”

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German regulator files criminal complaint against Greensill Bank https://indigodreams.net/german-regulator-files-criminal-complaint-against-greensill-bank/ Tue, 09 Mar 2021 10:56:43 +0000 https://indigodreams.net/german-regulator-files-criminal-complaint-against-greensill-bank/ German financial supervision has filed a criminal complaint against the management of Greensill Bank for alleged manipulation of the balance sheet, according to people briefed on the matter. The complaint, filed with criminal prosecutors in Bremen, where the bank is based, comes as its parent company, Greensill, prepares to file for insolvency protection in the […]]]>

German financial supervision has filed a criminal complaint against the management of Greensill Bank for alleged manipulation of the balance sheet, according to people briefed on the matter.

The complaint, filed with criminal prosecutors in Bremen, where the bank is based, comes as its parent company, Greensill, prepares to file for insolvency protection in the UK but transfers viable parts of the company at Apollo Global Management.

A deal with Apollo would likely wipe out Greensill shareholders such as SoftBank’s Vision Fund. The Japanese conglomerate’s $ 100 billion tech fund injected $ 1.5 billion into the company in 2019, but has already significantly reduced the value of its stake.

German officials’ decision on Wednesday complicates efforts to save parts of the Greensill Empire, a once high-profile supply chain finance group backed by SoftBank and advised by former UK Prime Minister David Cameron .

The complaint concerns the interim findings of a forensic investigation into Greensill Bank’s balance sheet that audit firm KPMG began at BaFin’s request late last year. Manipulation of the balance sheet can be punished by up to three years in prison under German law.

The BaFin, the German financial watchdog, also imposed a moratorium on the bank’s activities on Wednesday afternoon, thus freezing its operations. In one of the following stages, the lender will be liquidated.

“There is an imminent risk that the bank will become over-indebted”, BaFin said in a statement, adding that the lender was “closed for business with customers” and would be prohibited from accepting payments.

About 85% of the lender’s 3.5 billion euros in deposits come from retail investors and are insured by the German public deposit insurance system, but institutional depositors are on the verge of taking a 500 million hit euros.

KPMG’s audit raised concerns about the bank’s level of exposure to companies linked to metals tycoon Sanjeev Gupta, who is not the subject of the complaint and has not been charged with wrongdoing .

Greensill Bank said it had received “extensive advice” from German and UK law firms on the classification of receivable assets, and that auditors had reviewed and approved the classification.

“For the avoidance of doubt, Greensill Bank has always been transparent with its regulators and auditors on its approach to asset classification and the methodologies for determining those classifications,” he said, adding that BaFin had not done “no mention of criminal charges”. when he imposed the moratorium.

Gupta’s GFG Alliance declined to comment. A spokesperson for Bremen prosecutors confirmed that the complaint had been received. KPMG declined to comment.

BaFin is also concerned about the auditor of lender Ebner Stolz, a mid-size partnership based in Stuttgart. The watchdog will report Ebner Stolz to the German watchdog Apas, a person briefed on the matter told the FT.

Ebner Stolz said due to confidentiality obligations he has not commented on ongoing audit mandates. “We will immediately contact the authorities to offer our cooperation in clarifying the facts within our legal possibilities,” said Holger Jenzen, partner at Ebner Stolz.

KPMG’s investigation focused on the “receivables” financing facilities that the bank provided to Gupta companies, according to people familiar with the investigation, which are designed to be repaid by clients of a group.

This allowed the bank to classify the risk as being shared among a number of different companies, rather than a single large exposure to Gupta’s business, which could have broken the rules.

During its investigation, KPMG struggled to verify the existence of some of these invoices, said several people familiar with the investigation. He also determined that the “prepaid debt” facilities, under which the debt would be repaid by hypothetical future invoices, could be interpreted as an unsecured loan to the Gupta companies.

Gupta has a close relationship with Lex Greensill, the 44-year-old Australian banker who founded the finance company and previously held a stake in Greensill Capital.

The lender was founded in 1927 in Bremen as Nordfinanz Bank AG and renamed Greensill in 2014, when it was acquired by Greensill Capital. Subsequently, the balance sheet of the small regional lender grew rapidly.

BaFin said in a statement that Greensill Bank was “not systemically important” and that “the institution’s distress did not threaten financial stability”.

Greensill Bank’s loan portfolio is around € 3.5 billion, according to people familiar with its balance sheet, and more than € 2 billion is in debt financing related to Gupta’s activities.

In addition, the bank holds UK government guaranteed loans to entities linked to Gupta, the Indian-born businessman, whom the Financial Times revealed last year had been provided by Greensill. German officials fear that the British government could cancel these guarantees.

German regulators’ concerns about Greensill Bank were first triggered by an FT investigation in Gupta’s finances released a year ago, according to people familiar with the matter.

The FT’s investigation highlighted the amount of funding the British industrialist’s companies had drawn from the Bremen-based bank, while developer that Gupta’s own UK lender – Wyelands Bank – had funded its larger business empire through a network of shell companies.

Wyelands – which is named after a Welsh country estate that Gupta owns with his wife – said on Wednesday it would fully reimburse its own retail depositors after a £ 75million injection from Gupta.

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RBI issues second warning against aggressive digital lending practices https://indigodreams.net/rbi-issues-second-warning-against-aggressive-digital-lending-practices/ Tue, 09 Mar 2021 10:56:43 +0000 https://indigodreams.net/rbi-issues-second-warning-against-aggressive-digital-lending-practices/ The Reserve Bank of India has warned consumers against unauthorized digital loan applications, following persistent reports of poor loan approval and collection practices followed by some platforms. The RBI’s second warning in recent months prompted the Digital Lenders Association to issue a revised code of conduct, hours after the regulator’s notice. In a notice released […]]]>

The Reserve Bank of India has warned consumers against unauthorized digital loan applications, following persistent reports of poor loan approval and collection practices followed by some platforms. The RBI’s second warning in recent months prompted the Digital Lenders Association to issue a revised code of conduct, hours after the regulator’s notice.

In a notice released on Wednesday, the regulator said legitimate public lending activities can be undertaken by banks, non-bank financial companies registered with the RBI and other entities regulated by state governments.

Members of the public are urged to “check the background of the company / business offering loans online or through mobile apps,” the regulator said. The RBI has said consumers should never share copies of “Know Your Customer” documents with unidentified people and unverified / unauthorized applications.

The RBI has acknowledged reports of individuals and small businesses plagued by a growing number of unauthorized digital lending platforms. These reports show excessive interest rates and additional hidden fees charged to borrowers; adoption of unacceptable and authoritarian methods of recovery; and the misuse of agreements to access data on borrowers’ cell phones.

If consumers are faced with such issues, they should report these requests to law enforcement agencies or use the sachet platform, the regulator said.

This is the central bank’s second warning. In June, it reiterated its code of best practice for all lenders and requested additional documents for loan agreements signed by digital lenders. The RBI had also said that outsourcing a business activity did not lessen the obligations of the bank or the NBFC as regulatory compliance was only their responsibility.

Digital lenders publish new code of conduct

In response to the RBI warning message, the Digital Lenders’ Association said it had issued a revised code of conduct.

  • The code of conduct states that members must clearly list all costs and charges arising from the financial product or service offered. These costs should be explained with illustrations and a reimbursement schedule should be provided.
  • The effective annual interest rate of the loan should be clearly detailed in the documentation.
  • Lenders should ensure that there is no harassment or undue intimidation of customers, including practices such as calling (or threatening to call) any member of the customer’s family or any person associated with the client.
  • Lenders should follow a consent-based architecture for the data captured, along with a detailed explanation of the data captured and used.

To be sure, this code is voluntary and the ability to enforce is limited to asking lost members to leave the group.

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Education Ministry freezes student loan repayments until September https://indigodreams.net/education-ministry-freezes-student-loan-repayments-until-september/ Tue, 09 Mar 2021 10:56:42 +0000 https://indigodreams.net/education-ministry-freezes-student-loan-repayments-until-september/ (CBS) – At the behest of President Joe Biden, the Education Department on Thursday extended the nearly one-year hiatus on student loan payments until September, allowing the new administration to begin to hold its Election Pledge to Prioritize and Start Addressing the Over $ 1.5 Trillion Debt Crisis. Asking the ministry to extend federal student […]]]>

(CBS) – At the behest of President Joe Biden, the Education Department on Thursday extended the nearly one-year hiatus on student loan payments until September, allowing the new administration to begin to hold its Election Pledge to Prioritize and Start Addressing the Over $ 1.5 Trillion Debt Crisis.

Asking the ministry to extend federal student loan forbearance was part of the 17 executive actions Mr Biden signed on the first day of his tenure on Wednesday night. Many, including his action on student debt and an extension of moratoriums on evictions and foreclosures, are aimed at relieving Americans of the economic burden made worse by the coronavirus pandemic.

“Borrowers of all ages often face a difficult trade-off between paying off their student loans, investing in their long-term financial future, or paying their bills,” Biden administration officials wrote in a statement. communicated. “The pandemic has only worsened the economic hardship of millions of Americans with student debt.”

As of March, all federal student loan payments have been suspended within the framework of the federal government COVID-19[female[feminine reply. An extension of the grace period was included in the early drafts of the December stimulus package, but was cut in final negotiations. Prior to Mr. Biden’s executive action, payments were to resume at the end of January.

Student loan debt has been a looming financial problem since before the pandemic, but coronavirus-related job losses and widespread pay cuts, especially among millennials, have exacerbated the problem. Last year, federal student loan debt hit an all-time high, hitting $ 1.6 trillion among more than 40 million Americans, according to the Federal Reserve Bank of New York. On average, student borrowers owe between $ 200 and $ 299 each month, an amount that for many is simply unsustainable; about 1 in 5 borrowers are in default, depending on the US Department of Education.

A Pew Study As of November, nearly 6 in 10 borrowers said it would be “somewhat” or “very difficult” to resume their loan payments the following month.

“Too many Americans struggle to afford basic necessities and provide for their families. They shouldn’t be forced to choose between paying off their student loans and putting food on the table, ”an education ministry official wrote in a statement Thursday announcing the extension of the forbearance agreement.

On the way to the countryside, Mr. Biden promised Voters tackling student debt would be one of his top priorities as president. But exactly how the incoming administration plans to handle the $ 1.6 trillion debt remains unclear. As recently as last week, Mr Biden gave his backing to congressional action to write off $ 10,000 in federal student debt per borrower, but some of his more progressive Democratic colleagues say that is not enough. In the 2020 presidential primaries, Senator Elizabeth Warren of Massachusetts offered to write off up to $ 50,000 in debt and Senator Bernie Sanders of Vermont called for the cancellation of all student loans.

In December, Biden announced Connecticut’s school principal, Miguel Cardona, as his choice for education secretary. If confirmed, Cardona, who spent two decades of his education career as a public school teacher, would offer a direct juxtaposition to former Trump administration education secretary Betsy DeVos, a billionaire champion of school’s choice.

Under DeVos, the Education Department has warned the transition will be chaotic when student loan payments resume. In his 2020 Annual Report, the ministry said it expects loan managers and the federal government to “face a heavy burden in” converting “millions of borrowers into active repayment. Some of these borrowers, the report warns, will become delinquents.

Copyright 2021 CBS. All rights reserved.

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