Czechs Cut Key Rate Again With Outlook Becoming More Hawkish
Czech policymakers signaled inflationary risks may slow the pace of monetary easing after the central bank cut borrowing costs by half a percentage point for a third consecutive meeting.
Latest Videos
The information you requested is not available at this time, please check back again soon.
Czech policymakers signaled inflationary risks may slow the pace of monetary easing after the central bank cut borrowing costs by half a percentage point for a third consecutive meeting.
Donald Trump’s lawyer told a New York judge that a gag order in his criminal trial prevents the former president from responding to insulting social-media posts by the government’s star witness, his onetime lawyer Michael Cohen.
Greater Vancouver's real estate board says the number of homes that changed hands in April rose 3.3 per cent from the previous year, but total sales were still well below the 10-year average for the month.
Nomad, a financial-technology company that caters to Brazilians who want US dollar checking and investment accounts, is planning to open an office in Miami.
Like Apollo and KKR, the buyout giant is forging close ties with insurance firms as it hunts for new business and ready money. Regulators are starting to worry.
Nov 9, 2022
Bloomberg News
,Canadian real estate lender Romspen Investment Corp. has halted redemptions on its largest fund after a number of borrowers stopped making payments.
The Toronto-based firm will “temporarily defer payment” of redemptions until it’s clearer when borrowers will repay the loans and the fund can get cash from asset sales, according to a letter to investors dated Nov. 8. “Loan payoff activity remains suppressed.”
The move underscores the growing stress in the nation’s real estate market as a sharp rise in interest rates changes the economics of commercial projects and disrupts the housing market.
The firm, which is backed by New York-based TIG Advisors, is an established specialty manager of private mortgage funds, providing pre-development, construction and other loans for commercial and residential projects. It’s among the largest private players in that business in Canada.
The Romspen Mortgage Investment Fund had $2.8 billion (US$2.1 billion) invested in 134 mortgages at the end of June, about evenly divided between Canadian and US projects. Managers are now working to accelerate the sale of some assets to free up cash.
“Please be assured that we are working diligently to expedite a number of these portfolio transactions and remain confident in the underlying value of the fund’s assets,” Romspen said in the letter, which was signed by eight trustees.
“In many cases, however, such transactions involve coordinating the interests of a number of independent third parties, who are also affected by the present market uncertainties.”
Private lending funds gained popularity among investors hungry for yield during the era of rock-bottom interest rates. But mortgage finance vehicles have had a difficult year as rates increase. The rise in borrowing costs is also hurting developers as they seek capital to build new projects or refinance existing ones.
Romspen has cut back on its dealmaking in Canada as a result, Managing Partner Derek Jenkin told Bloomberg last month.
To preserve liquidity, the firm created a “runoff pool” for investors who want to get their money out as assets are sold. But that didn’t dampen redemption requests, according to the letter, which said the firm may take further measures if conditions worsen.
Romspen told investors it has still outperformed other asset classes this year, with an 8.2 per cent trailing one-year return as of June 30, according to its website. “We are confident that we will manage through this challenging phase and achieve reasonable long-term results for investors, much as we have in past periods of adversity over Romspen’s 50-plus year history,” the letter said.
When developers can’t catch up on their payments, Romspen forecloses and deploys teams to continue work on projects before selling them. Because it lends at 65 per cent loan-to-value, “the market would have to move by about 30 per cent for us to see any material loss in our book,” Jenkin said last month.