UPDATE 1-Rating agencies warn oil slump could trigger blizzard of downgrades

(Combines stories, adds detail, quotes)

By Marc Jones

LONDON, March 10 (Reuters) – The world’s top rating agencies said on Tuesday that the sharp drop in oil prices, if sustained, could cause a wave of sovereign downgrades as well as heavy multi-notch rating cuts to junk-rated oil and gas firms.

Fitch’s top Middle East and Africa sovereign analyst, Jan Friederich, told Reuters that with oil prices dropping as low as $31 a barrel this and likely to stay low, countries from Saudi Arabia, Iraq and Oman to Nigeria and Angola were all in focus.

“Countries that are in a somewhat vulnerable external position and have a fixed exchange rate are of course particularly vulnerable,” Friederich said.

On individual countries, he said Saudi Arabia’s financial reserves and its sovereign wealth fund provided a buffer but that there was not “infinite leeway” in the country’s A (stable) rating for the buffers to disappear.

A continued rise in government debt in Oman “would be a concern” he added, while Nigeria’s B+ (negative) rating could face problems if a prolonged attempt to defend the country’s currency peg ate heavily into its international reserves.

Commodity dependence is most pronounced globally in Angola, Iraq, Suriname and Gabon, Fitch analysis shows and there are a dozen more developing countries for whom commodities exceed 70% of foreign-currency income.

S&P Global meanwhile slashed its average Brent oil price assumption for the year to $40 per barrel, warning too that some junk-rated oil and gas firms could face multi-notch downgrades.

S&P had previously expected Brent to average $60 this year. It also cut its forecasts for next year to $50 from $55 and its Henry Hub gas price assumptions for this year to $2 per million British Thermal Units from $2.25 previously.

“It is likely rating actions (for oil and gas production companies) in the investment-grade category could be more severe than during the last cycle,” S&P said, adding that it would review all its exploration and production and oilfield services ratings over the next several weeks.

“For the high-yield segment, in particular, issuers without hedges, those who face upcoming maturities, and are somewhat squeezed on borrowing-base revolving credit facilities will most likely face multiple notch downgrades,” it added.

One of its top sovereign analysts, Frank Gill, also highlighted that no Gulf countries balance their bugets with oil at $40 a barrel and only Qatar and Kuwait do so at $50 a barrel.

“Except in the case of exporters with very low fiscal buffers, what matters is where oil prices settle next year, and that really depends on whether or not the global economy can recover significantly,” Gill said.

Elsewhere, Mexico could be hurt. “It has a significant oil sector and is closely connected to the U.S. economy,” Gill’s colleague Joydeep Mukherji said, also citing the problems posed by the Coronavirus.

Moody’s meanwhile cut its assumption for West Texas Intermediate prices for the year to significantly below last year’s average of $57 a barrel. (Reporting by Marc Jones; editing by Saikat Chatterjee and Angus MacSwan)

Source: Read Full Article

World News

No ethics rules broken by former top bureaucrat in SNC-Lavalin scandal: watchdog

The federal ethics commissioner says there is no reason to believe former Privy Council clerk Michael Wernick broke the conflict of interest law during the SNC-Lavalin affair.

In a report today, commissioner Mario Dion says he will therefore not undertake a full examination of the allegation and considers the matter closed.

In late September, the public sector integrity commissioner referred to Dion an accusation of conflict of interest against Wernick concerning his actions while he was the top public servant.

Such referrals require the ethics watchdog to take an initial look at the matter and issue a report.

Source: Read Full Article

World News

BBC Weather: Temperatures ‘higher than normal’ as scorching 26C heat boils Europe

BBC meteorologist Chris Fawkes shared a positive forecast for Europe this week as the Spring weather starts to settle in. The weather presenter noted that temperatures will range from 9C in Moscow to as high as 26C in Lisbon. However, he also said that northern Europe would still experience some “wet weather” too.

Mr Fawkes told viewers: “Northern areas of Europe will have fairly windy weather for 24 hours.

“With the weather fronts bringing cloudy skies and outbreaks of rain.

“That rain will push its way in across northern France, moving eastwards across Belgium, the Netherlands, Denmark and Germany at the moment.

“But, as we get into Wednesday, that rain will have moved all the way into western areas of Russia where it’s going to be quite heavy at times.”

He continued: “Milder air will be following so even in the likes of Moscow, we should see temperatures coming to about 9C or so on Wednesday.

“Across southeast Europe, the weather will be drier and more settled than it has been, more in the way of sunshine on Wednesday.

“Warm sunshine for Spain and Portugal with temperatures much higher than normal.

“Looks like highs will get up at 26C in Lisbon and 25C in Madrid.”

The BBC presenter added: “Further north, it’s not so warm because it’s windy and cloudy.

“We’ve got wet weather around as well.

“In Scandinavia, we’ll see quite a lot of cloud and still some bursts of rain and mountain snow as well.”

BBC Weather: Temperatures plummet in Europe as stormy weather enters [WEATHER]
BBC Weather: Stormy weather threatens to ‘pummel’ UK with floods [FORECAST]
BBC Weather: ’Significant snow’ freezes Europe as UK floods continue [VIDEO]

Mr Fawkes also said: “In the forecast for Thursday, there’s still a band of rain loitering across France and more rain to come in Germany.

“But towards northern areas, it starts to brighten up with some sunshine, a few showers running in from the North Sea.

“Over the next few days, in Paris, we should clear the cloud and rain.

“It should get a little bit brighter by Friday and on into the weekend where it’s set to get milder, temperatures up to 14C.

“In Berlin, temperatures will be around 11C on Thursday but it’s said to get cooler as we head into the weekend.”

Source: Read Full Article


UPDATE 2-Canadian banks face higher loan losses, lower earnings after energy lending growth

(Adds analyst comment, updates shares, oil price)

By Nichola Saminather

TORONTO, March 10 (Reuters) – Canadian banks boosted oil and gas lending at about double the rate of total business loan growth over the past three quarters, raising the specter of higher loan losses after Monday’s oil price crash.

Energy lending has picked up at Canada’s top banks even as bad loans and provisions for losses from the sector climbed, an analysis of company data by Edward Jones and Reuters shows.

Oil prices rebounded nearly 8% on Tuesday, following Monday’s slide of more than 20% on fears of a price war after Saudi Arabia and Russia said over the weekend they would raise oil production. Technical analysts said prices may be consolidating in a lower range.

“The developments (over the) weekend … are certainly negative for any banks that made loans to borrowers in oil and gas,” said James Shanahan, an analyst at Edward Jones. “I definitely see an increase in loan losses.”

Banks’ energy-related credit-loss provisions have climbed to the highest levels since 2016, while bad loans hit the highest in over two years in late 2019. The Canadian bank sub-index rose 0.9% by Tuesday afternoon, after Monday’s 11.2% decline.

Impairments at 2015-16 levels would hit banks’ earnings per share by 2% to 6%, depending on the severity of losses, Gabriel Dechaine, National Bank Financial analyst wrote in a note.

Bank of Montreal, TD Bank and Royal Bank of Canada have led growth in oil and gas lending over the past three quarters.

Oil and gas loan impairments across Canada’s banks were about 1.7% in the first quarter compared with 0.69% across all business loans, according to data from Scotiabank analyst Sumit Malhotra.

While that is down from a 6% peak in 2016, “another reset lower on prices just puts pressure on the banks,” Malhotra said.

Banks were already bracing for margin pressures after Canadian and U.S. central banks last week cut interest rates by 50 basis points in response to the coronavirus outbreak.

Canadian banks’ energy loans grew 16% in the quarter ended Jan. 31 from a year earlier, compared with 9% in total business and government lending. That followed 25% and 26% growth in the prior two quarters, versus 11% and 13% overall.

Lending activity rose following a “prolonged period” of very low write-offs on oil and gas loans, Edward Jones’ Shanahan said.

That pared some of the banks’ longer-term pullback from energy lending, with the loans accounting for about 5% of commercial loans, down from 6.3% five years ago, but up from 4.5% in 2018.

A BMO spokeswoman directed Reuters to Chief Risk Officer Patrick Cronin’s comments in January that overall lending-book credit quality remained sound. BMO, whose proportion of energy loans remains in line with the industry average, attributed some of the growth to the acquisition of $3 billion of loans from Deutsche Bank in 2018.

Bank of Nova Scotia and Canadian Imperial Bank of Commerce had the biggest proportion of oil and gas loans relative to total commercial loans, at 7.1% and 6.6% respectively. Still, Scotiabank’s energy loans account for 2.7% of total lending, down from 3.6% in 2016, and most of them are investment grade, a spokeswoman said.

An RBC spokesman said the bank’s energy loans accounted for only 1.3% of total lending.

“A stable economy requires stable energy prices,” RBC CEO Dave McKay said at a conference on Tuesday.

“To stop doing certain things we do today undermines the stability of energy, the stability of our economy. And it undermines our ability to make this critical transition.”

TD, CIBC and National Bank of Canada spokespeople declined comment.

Mark Naron, director at Fitch Ratings, expects higher energy-related provisions and impairments. “I don’t think it’s easy for Canadian banks to fully step away.” (Reporting by Nichola Saminather; Editing by Tom Brown, Dan Grebler and David Gregorio)

Source: Read Full Article

World News

Rift amid Métis leaders widens ahead of meetings with premiers, PM

The vice-president of the Métis National Council is stepping up his rhetoric against three provincial Métis leaders, accusing them of striking a “backroom deal” that allows new members into the nation whom he believes are not Métis.

The escalation is on the eve of a major meeting involving Prime Minister Justin Trudeau, provincial premiers and national Indigenous leaders where David Chartrand is set to represent the Métis National Council as its national spokesperson.

Two separate gatherings are being held this week among Métis members before the first ministers convene in Ottawa starting Thursday, and their divergent objectives highlight a growing rift between the leadership of the Métis National Council and the Métis leaders of Ontario, Alberta and Saskatchewan.

Source: Read Full Article

World News

NSHA opens coronavirus assessment centres across the province

The Nova Scotia Health Authority announced Tuesday that it has opened COVID-19 assessment centres across the province to help detect and contain the novel coronavirus in Nova Scotia where, to date, no cases have been confirmed.

According to the NSHA, the assessment centres are meant to help lessen current pressures in emergency departments, while also decreasing the possibility of transmission among the public.

The NSHA is calling these locations “COVID-19 assessment centres” because it wants to make it clear that while people may be sent to the sites by 811 for a physical assessment, “they will not necessarily be tested (swabbed), based on symptoms.”

People at assessment sites will be given a mask and have their travel history reviewed. Then it will be determined whether people can return home safely with instructions to self-isolate, or to be admitted to hospital.

“We expedited opening these COVID-19 assessment centres to respond to increased assessment demand as a result of the change in national screening protocols,” said Dr. Todd Hatchette, chief of microbiology with the Nova Scotia Health Authority.

The change in national screening protocols means anyone who has travelled outside Canada may have come in contact with the novel coronavirus and should closely monitor their health for 14 days after returning to the country.

“Travellers who start to feel unwell should stay at home/self-isolate from the public,” NSHA stated.

Nova Scotians who have travelled out of the country and who develop a fever with a temperature of 38 C or higher, and/or a cough, are also advised to call 811.

The NSHA said if there is a need for in-person assessment, 811 will refer you to a COVID-19 assessment centre.

“We want Nova Scotians to be able to access the right care, in the right setting, at the right times,” said Hatchette. “The resources of our health system are already strained by the seasonal flu and other demands.”

“These COVID-19 assessment centres are another measure that will focus our work on testing those who most require it and to also help lessen the pressure on the rest of our system. We ask for the public’s patience and cooperation as we respond to this quickly evolving situation.”

The assessment centres are located in eight different places, which include Cape Breton Regional Hospital, Yarmouth Regional Hospital and Valley Regional Hospital.

More to come…

Source: Read Full Article

World News

Coronavirus: B.C. senior’s death raises questions about isolation risk at nursing homes

Public health officials are urging people take extra infection control steps around older Canadians most at risk of developing COVID-19 complications, with the death of a Vancouver senior providing fresh imperative for vigilance in long-term care facilities.

News that the man in his 80s had died over the weekend coincided with assurances by various provinces that the well-being of nursing home residents was paramount.

Ontario’s health minister announced ramped-up screening and testing procedures, while Nova Scotia outlined a two-week waiting period for any out-of-country traveller who wanted to visit a nursing home.

Laura Tamblyn Watts, policy director at the National Initiative for Care of the Elderly (NICE), welcomed additional precautions but was wary of restrictions that “can be just as damaging” to a population prone to social isolation.

“It is such a vulnerable population to many forms of illness but in particular this COVID-19,” acknowledged Tamblyn Watts.

“We will certainly see increased protocols, I think across the board, for long-term care. The challenge, however, is when you have older people who are at risk of social isolation — it’s very upsetting for them to be in isolation in many instances. And if you have people with cognitive impairment, they may not understand why no one is coming to visit them.”

Ontario’s health ministry said Monday it was introducing “active surveillance” in which staff, volunteers, visitors and residents who come and go would be screened for symptoms and asked about travel history.

Source: Read Full Article

World News

Cheltenham Festival stripper and porn star lifts lid on boozy race parties

Cheltenham Festival is a gold mine for strippers says a UK porn star returning for 2020.

24-year-old Emily Blake ditched her desk job for an exciting new career in the adult entertainment industry after becoming bored with office work.

In less than two years Emily has built a huge following through an Onlyfans account with each subscriber paying £10 per month to watch her perform porn online.

Cheltenham, however, is the one time of the year that her fans can watch her strip off live because the money dancers can make is too good to miss.

  • Porn sets, Hooters and armadillo murders – Jobs celebs had before they were famous

  • Wardy's Cheltenham Festival 2020 day one wagers – including key dress code advice

Emily from Tamworth said: “I only started stripping a year ago on and off so last year was my first ever time I did it in Cheltenham.

“I worked there for three nights from Wednesday to Friday which were some of the best nights and memories I have.

“The money is so much better at Cheltenham week, I rarely bother dancing at any other events as it seems pointless.

“In just the three nights I worked last time, I made thousands.

  • Former Las Vegas escort lifts lid on kinky experiences – from stripping to threesomes

  • Cheltenham Festival 2020 has mobile pharmacy for punters amid coronavirus fears

“You get a lot more cash at Cheltenham because you get guys who think they’re from Wolf of Wall Street.”

Aside from horse racing, the annual week-long event in Gloucestershire is renowned for its wild booze-fuelled parties.

Each year punters from across the UK flock to Cheltenham, hoping to cash in big from a flutter at the bookies before splurging their winnings on saucy strip shows.

But with just two venues licensed by Cheltenham Borough Council for sexual entertainment, competition between erotic dancers to land a shift is fierce.

  • Falling stripper pole knocks gran unconscious at her own daughter’s hen do

  • Megan Barton Hanson's staggering wage she earned from kinky sex work career

Dancers must secure work months in advance with the limited places offered by sexual entertainment company, Eroticats in high demand.

Emily continued: “You have to book in straight away when they email you in January time – it’s that popular.

“If you don’t respond on that exact day you most likely won’t be able to get booked in.”

Despite there being just two venues for the entertainment, there is little chance revellers will go home disappointed.

Read More

Today's Top Stories

  • Meghan and Harry's new plans unveiled
  • Fresh coronavirus warning to smokers
  • Aldi shoppers leave OAP close to tears
  • Kidnapped girl found inside sofa bed
  • Altior out of Cheltenham Festival 2020 confirms trainer Nicky Henderson

“There are loads of us, I think there was at least 150 to 200 girls in the Two Pigs alone last year.”

Pressure has risen over the years from Cheltenham campaign groups which argue that stripping both de-values women and heightens the risk of sexual assault.

The local council says it always listens to opposition but it is beyond their power to ban sexual entertainment during Cheltenham Festival.

Louis Krog, licensing team leader, said: “The council deals with applications on their individual merits including giving opportunity for objectors to put their views forward before any decisions are made by the licensing committee.

  • Cheltenham tips: Top tipster The Couch calls winners on Day One of 2020 festival

“For the 2020 Cheltenham Festival, two applications for licensed sexual entertainment venues were received by the council.

"We are aware that other clubs will offer sexual entertainment during the week but these will not require a licence under the legislation as they are infrequently held.

“Due to the nature of the legislation that permits infrequent sexual entertainment to be unlicensed, it is not within the council’s remit to ban sexual entertainment during the races.”

Emily does not see a problem with women choosing to strip for work but thanks to the internet her and others in the industry no longer rely on employment by nightclubs.

She explained: “I don’t get why feminists etc argue about stripping, personally.

  • Cheltenham Festival 2020: Latest weather forecast for day one

“Everyone I know that does it loves the job, no one I know is forced into it.

“There is 100% a link between a shortage of strip club opportunities and the rise in Onlyfans accounts.

“I have Onlyfans myself and make enough to the point where I don’t even need to dance, I just do it because I enjoy it, I get to meet people and obviously it’s good to have more money.”

  • Cheltenham

Source: Read Full Article


Coronavirus wipes $70 billion off global listed airlines

LONDON (Reuters) – The rapid spread of coronavirus has wiped almost a third – or $70 billion – off the world’s top 20 listed airlines and reshuffled global rankings, elevating Air China into third place behind U.S. rivals, an analysis by Reuters shows.

The airline sector has been hit hardest by the outbreak of coronavirus, with falling ticket demand and Italy in lockdown forcing carriers to cancel routes and slash costs to survive the mounting crisis.

With the investor sell-off accelerating, United Airlines (UAL.O) has lost its number three position in the global line-up to Air China (601111.SS).

The U.S. carrier’s market capitalization has halved to $11.6 billion, the lowest since 2003, since the start of the year, leaving it also lagging behind Europe’s low-cost carrier Ryanair (RYA.I).

Air China has been relatively unscathed – its market cap was $15 billion on Tuesday, compared with $19 billion on Jan. 2.

The scale of the rout has been breathtaking.

Wizz Air, a budget carrier focused on central European routes, is now more highly valued than Air France-KLM, and the world’s most valuable airline, Delta Air, has seen more than $10 billion knocked off its value this year, taking its market cap to about $28 billion, the lowest since September 2016.

(Graphic: Global airlines by market cap – here)

Source: Read Full Article


Spread of virus drives Corporate America into cyberspace for annual meetings

(Reuters) – More U.S. companies are moving their annual shareholder meetings online to help contain the spread of coronavirus, raising concerns among corporate democracy advocates about investors losing access to top executives and board directors.

Starbucks Corp (SBUX.O) this month canceled its annual shareholder meeting in Seattle, known for attracting big crowds with free coffee, and said it would hold a “virtual” meeting for its shareholders instead on March 18.

Chip maker Qualcomm Inc (QCOM.O) is restricting access to its shareholder meeting on Tuesday to exclude people who have traveled to areas stricken by coronavirus, such as China and Italy. It will provide a webcast in addition to the in-person event.

Software developer F5 Networks Inc (FFIV.O) will for the first time allow shareholders to vote electronically as part of its virtual meeting on Thursday. F5 will also hold an in-person meeting in Seattle, but cautioned its investors about health and safety issues.

“We are seeing more and more companies discuss and consider moving toward virtual meetings this year due to the coronavirus issue,” said Courtney Adante, president of security risk advisory at global consulting firm Teneo.

The coronavirus outbreak, which originated in China last year and causes the sometimes deadly respiratory illness COVID-19, has killed more than 4,000 people globally and has been reported in 122 countries.

Developer meetings at Facebook Inc (FB.O) and Alphabet Inc (GOOGL.O), conferences such as music and technology festival South by Southwest and religious gatherings at churches and synagogues have been canceled outright to curb coronavirus.


Companies are hoping the digital meetings will help prevent the spread of the virus, while also providing access to shareholders who would not have attended the meetings physically. Many U.S. shareholder meetings are held in April and May.

“Holding a virtual meeting eliminates the enhanced risk of infections and the related legal exposure,” said Kai Liekefett, a partner at law firm Sidley Austin LLP, referring to the risk of investors filing lawsuits against companies if they become ill at the meetings.

Some investors see a worrying trend. They are concerned that these changes will become permanent, curtailing shareholders’ ability to demonstrate at the meetings and grill corporate management and boards of directors in person.

“If it is a virtual-only meeting, they can cherry-pick questions, they can avoid protests. This is not something shareholders want, it’s something boards and CEOs want so they can be unaccountable to shareholders,” said James McRitchie, an investor and shareholder advocate.

Starbucks and F5 did not respond to requests for comment about the effect of virtual meetings on access to their executives and board members. A Qualcomm representative pointed to disclosures on its website, which state that shareholders who attend its annual meeting in person must fill out a questionnaire regarding their travels.

To be sure, only a small fraction of companies currently host their annual shareholder meetings on the internet. Yet even before the coronavirus outbreak that number was growing. Some 248 U.S. companies held virtual shareholder meetings in the 2019 corporate voting season, up 17% from the year before, according to accounting and consulting firm PwC.


Environmentalists are particularly concerned. Climate activists have become a fixture at the annual shareholder meetings of oil majors Exxon Mobil Corp (XOM.N) and Chevron Corp (CVX.N). While Exxon and Chevron have yet to announce virtual shareholder meetings, activists say they risk losing an important forum that they use to pressure the companies.

“Managements and boards have disproportionate control over the flow of information and the ability of shareholders to ask questions,” said Jonas Kron, director of shareholder advocacy at investment management firm Trillium Asset Management LLC, which submits proposals on climate change and racial and gender equity. “(An annual shareholder meeting) is one of the few places where unscripted organic engagement can happen between management and shareholders.”

Exxon said this week it is still planning to hold its annual meeting in Dallas this year and Chevron said it continues to “monitor the situation very closely” and that its primary concern is the health and safety of employees.

The world’s largest annual shareholder meeting is still on, for now. Warren Buffett’s Berkshire Hathaway Inc (BRKa.N) said last week that its shareholder meeting in Omaha, Nebraska, on May 2, which typically draws 40,000 people or more and includes events such as a picnic and a 5k run, would go ahead. It added that the scope of the surrounding events may be “modified.”

“Postponing meetings may be a more respectful approach,” said Tim Smith, who leads shareholder engagement efforts at socially responsible investment management firm Boston Trust Walden Company. “We would argue this should not become a precedent.”

Source: Read Full Article