Fund – Observing The Sky http://www.observingthesky.org/ Mon, 21 Jun 2021 12:04:04 +0000 en-US hourly 1 https://wordpress.org/?v=5.7.2 https://www.observingthesky.org/wp-content/uploads/2021/04/observing-the-sky-icon-150x150.png Fund – Observing The Sky http://www.observingthesky.org/ 32 32 In a year of turmoil, residential solar assets are a safe investment https://www.observingthesky.org/in-a-year-of-turmoil-residential-solar-assets-are-a-safe-investment/ Tue, 09 Mar 2021 10:56:51 +0000 https://www.observingthesky.org/in-a-year-of-turmoil-residential-solar-assets-are-a-safe-investment/

The residential solar industry in the United States has continued to regain momentum after a difficult spring season due to the coronavirus crisis. In addition to the recovery in demand, the strong performance of assets throughout the pandemic has proven that residential solar is ready for further investment from various sources of capital.

Attractive financing options, especially solar loans, have greatly contributed to the market recovery. Homeowners are looking to save money during this tough economic time. Buying a solar system through debt offers immediate bill savings and doesn’t require customers to spend precious money.

Tuesday, Sunlight Financial ad that it has funded more than $ 3 billion in loans for solar systems and home improvement projects, while Mosaic passed this mark back in January of this year. Loanpal, currently on the biggest financier in the industry, financed more than $ 4.5 billion in solar loans in October, according to a report by the Kroll Bond (KBRA) rating agency.

These three major solar loan providers are among the fastest growing private companies in the United States in recent years. In addition to the large second quarter market contraction due to the coronavirus, this growth trend continued into 2020. Installers and loan companies have reported monthly increases in sales and loan approvals since the governments of the States have started to relax lockdown restrictions. Many players have also achieved record sales volumes in recent months.

Solar loan portfolios passed COVID-19 stress test

The proliferation of these financiers and more generally of the solar credit market is a well documented trend in industry. But the strong overall performance of the asset class is arguably an even more important indicator of success.

The remarkable resilience of residential solar power throughout the pandemic has proven that these assets can withstand times of economic downturn and uncertainty. Positive news came in May when KBRA announced a full review of all outstanding ratings for asset-backed solar loan securitizations in response to the macroeconomic impacts of the COVID-19 pandemic. For the 17 securitizations rated by the agency, KBRA did not issue any downgrading or placement under surveillance.

Sources: Kroll Bond Rating Agency, Sunlight Financial, Wood Mackenzie. Loss rates for Mosaic, Sunnova and Dividend are based on cumulative net loss. The rates for Loanpal and Sunlight Financial are based on cumulative gross loss.

Solar loan providers continue to report that their business volumes have maintained healthy forbearance demand levels and low default rates. Several vendors have introduced payment relief programs to help customers get through COVID-19. As documented by KBRA, these have remained mostly intact. Loans to which Loanpal has granted COVID-19 disaster tolerance peaked at just over 1% of its overall portfolio in June, and that rate fell to 0.38% in October. Only 0.3% of Sunnova customers needed short-term payment assistance in May. Mosaic had granted extensions to 2% of its customer base, also in May, and that figure fell to 0.29% in August.

The concept of a “bill hierarchy” can help explain the low default rates of residential solar assets. Most solar customers enjoy a bill swap and substantial monthly savings over their utility bill before they switch to solar. The alternative to paying for a solar loan would likely be more costly for the customer; therefore, there is a powerful incentive to stay up to date on the loan. This is especially true in times of economic downturn where saving money is crucial.

It’s time to pick the industry winners

Securitization markets are just a glimpse of the investment landscape. For example, Sunlight Financial sources capital from forward agreements and private portfolio transactions. Here, too, we see strong asset performance and loss rates among the lowest of any deal.

Of course, performance varies between transactions and vendors. Mosaic has the most experienced loan portfolios and therefore the longest data trail. The company’s latest securitization, which has been repeatedly oversubscribed, demonstrated the strong demand for these assets as more historical data on loan performance accumulates month after month. Investors looking to enter or expand their presence in this space will closely observe these changes in loss rates for each supplier. This will be an important step in investment due diligence going forward.

It is true that solar loan portfolios are still in their infancy and years of payments are yet to come. However, now that the industry has proven itself through a crisis, little doubt remains when it comes to assessing the merits of the asset class. Issuers trade more frequently, and a growing history of performance data provides more clarity and insight for investment decision making.

As a result of these factors, investors have become more comfortable with the residential solar asset class over the past couple of years and have rewarded players with more capital at lower costs. Banks and credit unions have more cash on hand due to increased deposits as homeowners keep their savings. These organizations are looking for a place to solidly deploy their capital. Their question regarding residential solar is shifting from “Should we invest?” To “What company should we invest our money in?”

While the pandemic is not over and the solar industry is still battling a recession, one thing has become clear: As a mature asset class, residential solar has achieved its first real test, and there are many positive signs for the future. Institutional investors who have settled into this space are sure to be happy with the results they have seen so far.

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Bryan White is a solar analyst at Wood Mackenzie and author of Update on Residential Solar Finance in the United States report series. Look for the report’s next publication in December on woodmac.com.

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$ 3M Small Business Fund Approved in Kalamazoo https://www.observingthesky.org/3m-small-business-fund-approved-in-kalamazoo/ Tue, 09 Mar 2021 10:56:51 +0000 https://www.observingthesky.org/3m-small-business-fund-approved-in-kalamazoo/

Good news for Kalamazoo small businesses, Kalamazoo’s small business loan fund program has been expanded.

Originally established in March 2020, the Kalamazoo Small Business Loan Fund Program, or KSBLF, was a partnership between the City of Kalamazoo and United Way of the Battle Creek and Kalamazoo Region. It started with $ 2 million in funding and has certainly helped local businesses. According to MLive.com, a total of 947 employees were able to keep their jobs thanks to the KSBLF.

It was then. And now?

At a committee meeting earlier this week, the town of Kalamazoo and United Way of the Battle Creek and Kalamazoo Region agreed to an expansion. In total, this extension of the original KSBLF will amount to $ 3,115,500. The city plans to divide this amount over the next three years, with a total of $ 1,038,500 being used each year.

This expansion also aims to emphasize equity. Businesses owned by women or owned by Blacks, Aboriginals and people of color will be given priority.

The KSBLF will provide eligible businesses located in the town of Kalamazoo with a loan of $ 5,000 to $ 50,000.

Are my businesses eligible?

Obviously, not all businesses will be eligible for the loan. However, if your business meets the following criteria, you may be eligible.

  • Must be located in Kalamazoo Town
  • Must have 50 full-time equivalent employees or less
  • Annual business income must be $ 2.5 million or less

There are a few other qualifications you can read here.

In addition, there is another grant called the Kalamazoo Micro-Enterprise Grant Fund for companies with 10 or fewer full-time employees. This grant is valued at $ 5,000. You can find out more about how to apply for this grant here.

It feels like we are slowly starting to pull ourselves out of this pandemic, but that doesn’t mean everything will be back to normal. While the majority of us are doing our best to survive and get by, let’s also make sure to give some love to our local businesses. And it doesn’t work to have means spending money. Here are some quick ways to share the love without spending a dime:

READ MORE: See 50 remote jobs that can pay well

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SBA, lenders take more action to improve paycheck protection program https://www.observingthesky.org/sba-lenders-take-more-action-to-improve-paycheck-protection-program/ Tue, 09 Mar 2021 10:56:50 +0000 https://www.observingthesky.org/sba-lenders-take-more-action-to-improve-paycheck-protection-program/

Enter Wall Street with Street Insider Premium. Claim your 1-week free trial here.


Washington, February 10, 2021 (GLOBE NEWSWIRE) – Today, U.S. Small Business Administration and lenders are making more progress in improving Paycheque Protection Program (PPP) so that small businesses can access the much-needed PPP funds to persevere during the pandemic, recover and rebuild better. The Authority works with the Agency to increase equitable access to underserved small businesses, to ensure the integrity of the program, and to promote rapid and efficient distribution of funds.

This week, the SBA took a significant step forward by approving $ 104 billion in P3 funds to more than 1.3 million small businesses. Highlights from this round include:

  • Reach more small businesses; 82% of all loans go to businesses asking for less than $ 100,000
  • Reaching rural communities in a meaningful way; 28% of businesses that received funding from this round are in rural communities
  • Increase partnerships with community development finance institutions (CDFIs) and minority depositories (MDIs) which are trusted agents to extend economic assistance to minority communities and underserved populations

The SBA is also following through on its pledge to take additional steps to speed up resolution of data inconsistencies and eligibility issues so that small businesses have as much time as possible to access much-needed PPP funds, all the while. maintaining the integrity of the program. Three important changes:

  1. Allow lenders to directly certify borrower eligibility for first and second draw PPP loan applications with validation errors to ensure businesses that need funds and are eligible receive them as quickly as possible
  2. Allow lenders to upload supporting documents for borrowers with validation errors during the remittance process
  3. Create additional channels of communication with lenders to ensure that we are constantly improving the fairness, speed and integrity of the program, including an immediate call to domestic lenders to inform them of the platform’s additional capabilities

“We are delighted that the Paycheque Protection Program is targeting the smallest of small businesses and providing economic relief at a critical time in American history. The SBA has taken another important step in providing critical recovery capital to small U.S. businesses by approving 1.3 million PPP loans totaling $ 104 billion in the current cycle. While we are excited to do a better job of reaching the hardest-hit industries and communities, we are committed to taking additional steps to ensure equitable access to underserved businesses and which we are empathetically leading to support small businesses. in a difficult situation, ”SBA Senior Advisor to Administrator Michael Roth said.

Through SBAs 68 district offices, the Agency will work in close partnership with the Biden-Harris administration to further leverage its network of resource partners and develop multilingual access to and awareness of PPP. Updated information on PPPs, including forms, tips and resources, is available at www.sba.gov/ppp and www.treasury.gov/cares.

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About the United States Small Business Administration

The Small Business Administration of the United States is making the American dream of becoming a business owner a reality. As the only resource and voice for small businesses backed by the strength of the federal government, the SBA gives entrepreneurs and small business owners the resources and support they need to start, grow or grow their businesses, or grow their businesses. recover from a declared situation. disaster. It provides services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit www.sba.gov.

Press Office
United States Small Business Administration
Press_Office@sba.gov

Source: United States Small Business Administration

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Liverpool transfer news: Fulham wants £ 10million in Harvey Elliott court https://www.observingthesky.org/liverpool-transfer-news-fulham-wants-10million-in-harvey-elliott-court/ Tue, 09 Mar 2021 10:56:50 +0000 https://www.observingthesky.org/liverpool-transfer-news-fulham-wants-10million-in-harvey-elliott-court/
Why does Fulham want £ 10million?

Fulham is said to be after historic charges for Elliott as they feel they should be rewarded for their role in promoting his development.

They are entitled to compensation following Elliott’s transfer because the attacking midfielder left the club at the end of his contract when he was under 24. Elliott was first registered as a Fulham player at the age of 11 in July 2014, and his formative years were spent in their academy.

It is not an ordinary talent. Elliott became Fulham’s youngest player when he made his first-team debut at the age of 15 in a Carabao Cup match against Millwall in September 2018.

Later that season he also became the youngest player in Premier League history – at the age of 16 years and 30 days.

After joining Liverpool, he also became their youngest player to start a game when he played against MK Dons in the Carabao Cup.

Fulham was desperately disappointed to lose Elliott to Liverpool as then coach Slavisa Jokanovic and later Scott Parker both saw him as a key part of their plans.

But it is understood that they also believe that they will lose considerably in financial terms.

Elliott was seen as a star in the making, but even if he doesn’t reach such heights, Fulham is still in the line to suffer a major loss. As a relevant scorer, Rhian Brewster left Liverpool for £ 20million this summer without making a league appearance.

Added to this is the growing importance of local talent in light of Brexit, which inhibits the buying and selling of players under the age of 18 from the European Union.

Why is this a historic case?

This should be a historic case for the sale of young players as it is believed the result could deter smaller clubs from investing in their academy facilities.

The last major case involving the Professional Football Compensation Committee involved Ethan Ampadu, where the guaranteed award of £ 850,000 to Exeter was widely criticized. The highest fees awarded by the PFCC remain the transfer of Danny Ings from Burnley to Liverpool, where the Reds were ordered to pay £ 6.5million.

Fulham has invested heavily in setting up his academy and first achieved Category 1 status in 2012.

In Elliott’s case, it is understood the player had similar potential to Ryan Sessegnon, who left for Tottenham for £ 24million, with Josh Onomah the other way around, in 2019.

The concern is that a low fee would undermine efforts to develop young players.

What has he done since joining Liverpool?

After signing from Fulham, Elliott joined Liverpool’s first team for the Premier League and Champions League, quickly becoming the youngest player to start a game for the club.

He is also the second youngest player to appear in a competitive game for Liverpool, as well as the youngest player to start a game at Anfield.

He made his Premier League debut for the club in January 2020, coming off the bench to replace Mohamed Salah in a 2-0 win over Sheffield United.

Since being loaned to Blackburn this season, Elliott has scored four goals and provided eight assists in 22 appearances. Blackburn is now eighth on the second level.

Is there anything else i should know?

Yes, for more on Elliott’s progress at Blackburn Rovers, go further below.

(Photo: John Powell / Liverpool FC via Getty Images)

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Indianapolis Preserves and Showcases its Activist Art from the Stormy Summer of 2020 https://www.observingthesky.org/indianapolis-preserves-and-showcases-its-activist-art-from-the-stormy-summer-of-2020/ Tue, 09 Mar 2021 10:56:49 +0000 https://www.observingthesky.org/indianapolis-preserves-and-showcases-its-activist-art-from-the-stormy-summer-of-2020/

What does the story look like?

that of Francisco Goya May 3, 1808?

that of Picasso Guernica?

When the story of 2020 is written, it will look like plywood murals spanning hundreds of business windows and painted by artists demanding social justice.

From New York to LA, Minneapolis, Chicago and Indianapolis, the artists expressed their emotional responses to a nation in crisis by taking advantage of free public spaces on which to share their feelings. With museums and galleries closed to COVID-19, their plywood murals have become America’s most attractive and visible works of art. They offered a real-time artistic reaction to the murder of George Floyd at the hands of the police, the murder of Breonna Taylor at the hands of the police, Black Lives Matter entering the mainstream world and the country taking into account its racist history in a wider meaning than ever. previously.

In June, 24 Indy-based artists were commissioned to create murals on storefronts in downtown the city in immediate response to global protests calling for an end to police brutality. The Murals for Racial Justice project was originally organized by the Arts Council, Indianapolis Cultural Trail Inc., PATTERN, St’ArtUp 317 and cultural entrepreneur Malina Simone Jeffers.

The original plan was to exhibit more of the murals along the Indianapolis Culture Trail, but the delicacy of the plywood made it unsuitable for long-term outdoor exposure.

Indianapolis arts organizations strive to ensure that these statements are not lost in history.

Indianapolis Central Library

Photographic replicas of more than 20 works of art from Murals for Racial Justice have been transformed into large banners which will be displayed on November 16 at the Central Library, in partnership with the Center for Black Literature and Culture. Individuals and organizations will be permitted to borrow the 3-by-5-foot vinyl banners, free of charge, through the Indianapolis Public Library for display at public and private events.

To document the historical and artistic significance of the murals, DIAGRAM produces the high quality images that are reproduced on the vinyl banners.

“These images have helped us see the world differently,” said Danicia Monét, artist, equity practitioner and design researcher who manages the Murals for Racial Justice project. “One of the guiding principles of this initiative has been commemoration and education. We want to continue to push for systemic change in our local communities and encourage the public to learn more about why this work for justice and liberation is vital. “

Indianapolis Art Center

In addition to plywood murals, another of the most striking and spontaneous artistic visuals in decades has come from Black Lives Matter Street Murals Across the country.

The Indianapolis Art Center presents, “EIGHTEEN: black lives matter” showcasing the work of the 18 local artists who participated in painting a large-scale mural on Indiana Avenue as part of the racial justice movement in August. Each artist took a letter with a hashtag symbol on the front and a fist icon on the back.

“When I went to see the mural being painted on Indiana Avenue, I saw the caliber of work done by the artists – many of whom were unknown to me at the time – on the mural and I I quickly approached the organizers, Mali Jeffers and Alan Bacon, who date to present this collective of talents to the community and present them as individual artists, ”Mark Williams, president and executive director of the Indianapolis Art Center.

“Most of these artists didn’t know each other until they came together to create the Indy’s Black Lives Matter mural,” said Jeffers, a freelance art consultant who represents the 18 artists. “They are all talented and deserve full attention, so we look forward to bringing them to light individually through this exhibition. “

Presented until January 6, 2021, “EIGHTEEN” features paintings, chalk work and digital design. Some the works of art in the exhibition will be on sale at the Art Center, as well as online.

Art institutions have struggled to react in real time to capture, organize and interpret artists’ responses to the various tragedies of 2020. The The botched exhibition of the Whitney Museum of America Art of militant art by being the most visible example.

Williams explained how the Indianapolis Art Center was able to do this effectively.

“My board and our entire team were prepared to act quickly, bypassing some of the usual processes and protocols, in order to respond to a unique opportunity at very unique times,” said Williams. “We were helped by established partnerships and relationships that we could build on rather than having to scramble to find connections at a time that really cried out for the community.”

This last comment is crucial.

Institutions that did not care about racial equality and social justice before, that had not worked with artists of color and activists for many years, found themselves caught off guard by the outpouring of artistic creativity from summer. They could not respond effectively because they still had to recognize internally the problem of systemic racism, both within their walls and throughout their communities. They had to educate themselves on wrestling, debate internally if this was a direction and a commitment they were willing to undertake, and then research and do presentations with the artists and organizers who did the heavy lifting of this work for years.

“This is really what we do, all the time – we reflect and serve the community around us, we encourage and facilitate the conversations that take place and we meet people where they are without expectation,” said Williams. “In short, we are building community through art, and the community needed us to step in at the moment. So we did.

Indiana State Museum

Two downtown murals were donated to the Indiana State Museum by the owners of the businesses, Silver in the City and The Flying Cupcake. They will be added to the museum’s permanent collection.

Plans are taking shape for an upcoming exhibition featuring these murals as well as works by individual artists who have participated in the Murals for Racial Justice program. Many murals remain in the personal possession of the artists who created them and the museum will borrow them for the exhibition.

Williams hopes that the current energy surrounding black artists and the promotion of social justice through works of art continues, and that art museums help lead the way.

“Like so many elements of our society, artistic institutions must be prepared to recognize and dismantle entrenched barriers to marginalized voices,” he said. “Having a unique forum as an artistic institution to address the joys and sorrows of humanity, strengths and weaknesses, beauty and ugliness, we must be more intentional to regularly provide this forum and a safe space to expression to those who have traditionally been denied opportunities to be heard. If we do this, we can help promote a more just and inclusive society; if we don’t, we will simply fail to achieve our goal.

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3 sources of money to tap into before getting a personal loan https://www.observingthesky.org/3-sources-of-money-to-tap-into-before-getting-a-personal-loan/ Tue, 09 Mar 2021 10:56:48 +0000 https://www.observingthesky.org/3-sources-of-money-to-tap-into-before-getting-a-personal-loan/

Personal loans can be an affordable way to borrow. But before you apply, it might pay off to try and access money elsewhere.

When you need money in a pinch, a personal loan can be a good option. You will pay interest on a personal loan, but the amount can be paltry compared to what you would pay on a credit card balance. And during the pandemic, you may even be eligible for a coronavirus hardship loan. But before you go out and borrow with a personal loan, you might want to consider these sources of cash instead.

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1. Your emergency fund

Some people are reluctant to dip into their emergency savings because it means losing some or all of their safety net. But the whole point of having an emergency fund is for emergencies where you need money your paycheck can’t cover (or when you don’t have a paycheck at all). As such, you are usually better off plundering your savings. before you go out and borrow money elsewhere. This way you avoid accumulating interest.

2. The equity in your home

The equity in your home is the part of your home that you own in full. For example, if your house could sell for $ 300,000 today and you owe $ 150,000 on your mortgage, you would have $ 150,000 in equity. And there are ways to harness that equity when the need for cash arises.

Specifically, you can take out a home equity loan or a home equity line of credit (HELOC). With the first, you borrow a lump sum that you repay in installments, just like a personal loan. With the latter, you have access to a line of credit that you can draw on for a predefined period of time (typically five to 10 years).

The interest rate you will pay on a home equity loan or HELOC may be lower than the rate you will pay on a personal loan. Plus, if your credit score isn’t good, a home equity loan or HELOC can be much easier to obtain. The reason? Your home serves as collateral for your loan.

Ascent’s selection of the best personal loans

Are you looking for a personal loan but don’t know where to start? Ascent’s choices for the best personal loans help you demystify the offers available so that you can choose the one that best suits your needs.

See the selections

Personal loans, on the other hand, are unsecured, so you will usually need better credit to get a good rate. That being said, if you use your home as collateral and fall behind on your payments, you risk losing your home.

3. Your family

Not everyone has family members with abundant financial resources. But if you have a close family member – a sibling, parent, or grandparent – who is in a strong financial position, you may want to apply for a loan rather than going to a loan institution. credit.

A family member may agree to lend you money without interest, which will make it much easier to repay. Also, if you only need a small amount of money and you don’t qualify for a coronavirus hardship loan, you might have trouble with a personal loan. These loans generally impose borrowing minimums. If you’re missing $ 500 to pay your bills, for example, requesting a loan from a family member may be a more reasonable solution. If you are borrowing from a family member, be sure to repay the money as agreed. You don’t want to hurt your relationship with someone who has tried to help you.

When you’re in trouble, a personal loan can be a good way to borrow. If you stick to your monthly payments, you won’t hurt your credit score like you would by carrying credit card debt. But before taking out a personal loan, it pays to explore the options above. They could all be an easier or cheaper way to access cash when you need it.

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MPs approve new law to regulate mobile lending rates https://www.observingthesky.org/mps-approve-new-law-to-regulate-mobile-lending-rates/ Tue, 09 Mar 2021 10:56:48 +0000 https://www.observingthesky.org/mps-approve-new-law-to-regulate-mobile-lending-rates/

Companies

MPs approve new law to regulate mobile lending rates


Central Bank of Kenya. PHOTO FILE | NMG

john-mutua-img

summary

  • Parliament approved a bill to regulate mobile loan rates and the treatment of delinquent loans to protect borrowers from predatory lending.
  • On Thursday, lawmakers agreed for consideration and debate on the bill which, if passed, will put dozens of digital and mobile lenders under the oversight of the Central Bank of Kenya (CBK).

Parliament approved a bill to regulate mobile loan rates and the treatment of delinquent loans to protect borrowers from predatory lending.

On Thursday, lawmakers agreed for consideration and debate on the bill which, if passed, will put dozens of digital and mobile lenders under the oversight of the Central Bank of Kenya (CBK).

The Central Bank of Kenya Bill 2020 (Amendment) is now before the National Assembly’s Finance and National Planning Committee, where Kenyans and other stakeholders will be invited to give their views before it is returned to the House for debate and vote.

The CBK currently regulates banks and micro-lenders, but the proposed changes will now grant it supervisory and licensing powers to oversee hundreds of digital lenders operating in the country.

“The proposed amendment aims to achieve the following objectives, prohibiting any person, institution or business from lending money to Kenyans without authorization from the Central Bank of Kenya,” says an opinion on the bill sponsored by the MP named Gideon Keter.

Dozens of unregulated micro-lenders have invested in Kenya’s credit market in response to growing demand for quick loans.

Their proliferation has imposed high interest rates on borrowers, which climb to 520% ​​when annualized, resulting in growing defaults and an ever-increasing number of defaults that have been unfavorably listed with credit reference bureaus ( CRB).

Market leader M-Shwari, Kenya’s first mobile savings and credit product introduced by Safaricom and Commercial Bank of Africa, charges 7.5% “facilitation fees” on credit regardless of term, bringing its annualized lending rate to 395%.

Tala and Branch, other leading players in the mobile digital lending market, offer annualized interest rates of 152.4% and 132% respectively.

The push to control the activities of digital lenders comes more than a year after Kenya removed the legal cap on commercial lending rates.

The cap, introduced in September 2016, had slowed growth in credit to the private sector as commercial banks turned their backs on millions of low-income customers and small and medium-sized businesses deemed too risky to lend.

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Two Special Sessions: China Takes Cautious Approach to 2021 GDP Growth, Reduces Budget Deficit Target and Local Government Bond Quota https://www.observingthesky.org/two-special-sessions-china-takes-cautious-approach-to-2021-gdp-growth-reduces-budget-deficit-target-and-local-government-bond-quota/ Tue, 09 Mar 2021 10:56:48 +0000 https://www.observingthesky.org/two-special-sessions-china-takes-cautious-approach-to-2021-gdp-growth-reduces-budget-deficit-target-and-local-government-bond-quota/ In this special round-up of China’s two-session annual parliamentary meeting, the central government sets a conservative annual growth target for the Chinese economy in 2021, signals a slight tightening of fiscal and monetary policies, and plans to expand regulatory oversight of the FinTech sector. .

China kicked off its one-week “Two Sessions” annual parliamentary meeting Thursday. Prime Minister Li Keqiang delivered the government’s activity report to the 13th National People’s Congress (NPC) for deliberation on Friday morning.

In the report, China set an annual economic growth target of “above 6%” for 2021 – a number seen as a defensive target by economists and analysts.

The Chinese economy grew by 2.3% year-on-year in 2020, although no digital target has been defined last year after the outbreak of the Covid-19 pandemic.

The new 2021 target is “close at hand” due to a weak base in 2020, and growth could be 9.2%, said Kevin Xie, senior economist for Asia at the Commonwealth Bank of Australia, in a Friday afternoon note.

An annual rate of around 6% for economic growth would be “quite low,” a BNY Mellon Investment Management research note said Friday before the official figure was announced. Aninda Mitra, senior sovereign analyst at the firm, forecasts GDP growth of 8.4% this year and inflation of around 1.6%.

Liu Ligang, chief economist for China at Citi Research, expected the target to be 7% or more in a note earlier this week.

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The growth target for the consumer price index – an indicator of inflation – is 3%, higher than the 2.5% recorded last year.

Citi’s Liu said earlier this week that the CPI inflation cap could be lowered to 3% from last year’s target of 3.5%.

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Beijing aims to create 11 million new jobs and an unemployment rate of around 5.5% by the end of 2021. The urban unemployment rate surveyed was 5.2% at the end of 2020. Last year, 11, 86 million new jobs were created, against the target of 9m.

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The government plans to reduce its budget deficit for 2021 to 3.2% of GDP, from a previous target of over 3.6%. It will no longer issue special treasury bills to fight the pandemic, after Rmb1tr of this show Last year.

This year’s quota for local government bonds has been lowered to 3.65 tr Rmb from 3.75 tr Rmb last year. The official figure defied some market rumors of a 20% drop in quota. The emission limit for local authorities was set at 2.15 tr Rmb in 2019.

“The announced fiscal policy targets involve a modest rather than a brutal tightening,” said ABC’s Xie, noting that the 3.2 percent lower budget deficit is still the second highest in recent years, and the new quota of local government bonds is much higher than what was allocated in 2019.

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Li said Beijing will continue to improve and implement tax cuts to “lend a hand” to “restore vitality” to the Chinese market.

Other support measures have been announced for small businesses and individuals. To encourage innovation, companies will continue to benefit from an additional 75% tax deduction on their research and development expenses.

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China will keep its “prudent” monetary policy focused, flexible and appropriate. This year’s money supply and total social finance growth are expected to be broadly in line with nominal GDP growth, “reasonably abundant” liquidity, stable macroeconomic leverage ratio, and “mostly stable” renminbi exchange rate. according to the government’s activity report.

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Beijing is also aiming to further help small and micro businesses raise funds. This will allow these companies to continue to defer payment of principal and interest on loans, while increasing support through the central bank’s on-lending and rediscounting program.

Big commercial banks have been asked to give at least 30% more lending to small businesses this year, having already increased their lending by 50% year-on-year in 2020.

China is pushing its financial system to continue to cap profit growth in order to further support the real economy and lower the cost of borrowing. Financial institutions have been tasked with give up Rmb1.5tr of profit Last year.

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China’s opening-up policies will be implemented “with a broader scope, in broader fields and at a deeper level” this year, Li said. The government has pledged a stable development of international trade, shorten the negative list of foreign investment, gradually open up the service sector and publish the negative list for cross-border trade in services.

China will ensure fair competition between domestic and foreign enterprises, protect the legitimate rights of foreign enterprises, and welcome more foreign investment.

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The government has said it will deepen national reforms, including in state-owned enterprises. It will intensify anti-monopoly work and prevent the “unruly expansion” of capital and unfair competition.

Chinese regulators plan to continue to help recapitalize small banks and strengthen their corporate governance. They will also steadily advance the implementation of a registration-based system for national fundraising, improve the onshore write-off mechanism as well as the bond market infrastructure, and create more funding opportunities for investors. Chinese institutions.

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Beijing will also strengthen regulatory oversight of financial holding companies and fintech, and ensure that financial innovation is subject to prudent oversight. Systemic risks in the financial sector should be avoided, according to the government’s activity report.

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The government’s activity report referred to initiatives such as “the Belt and Road” and bilateral, multilateral and regional economic cooperation. These include the signing of the Comprehensive Agreement on Investment between China and the European Union and the negotiations of the China-Japan-South Korea Free Trade Agreement. Beijing is also is actively considering joining Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

Li said China is willing to develop Sino-US relations around economy and trade on the basis of “mutual respect.” But he cautioned against foreign involvement in matters relating to Taiwan and the special administrative regions of Hong Kong and Macao.

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The country further focused on sustainable development and green transformation on land. China is committed to “vigorously developing” new sources of energy, including nuclear power, and has set a target that 70% of heating in northern China comes from clean energy.

The government will work around its goal of achieving “carbon neutrality” by 2060, including forming a work plan for the country to peak carbon dioxide emissions by 2030. It will propose policies to increase financial support for green and low-carbon development. .

As part of the 14th Five-Year Plan, which will also be deliberated by the AFN, China will explore the development of the ocean economy.

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Alien invasion in New Jersey https://www.observingthesky.org/alien-invasion-in-new-jersey/ Tue, 09 Mar 2021 10:56:48 +0000 https://www.observingthesky.org/alien-invasion-in-new-jersey/

Do you believe in aliens? What if I told you that enough people believe in them in New Jersey to cause absolute hysteria? What if I told you that the mere mention of an alien landing here sparked gunfire and destruction? He did and it was crazy.

In case you never know, your New Jersey compatriots went bananas in October 1938. Just to set the stage, radio was pretty much everyone’s only form of entertainment at the time. They would get together as a family to hear the news or to listen to a story. So when Orson Welles told 12 million listeners during his live update that we had a Martian landing at Grover’s Mill, the people of New Jersey went absolutely ballistic. The residents swung into action and switched to combat or flight mode. They joined forces and decided to shoot first and ask questions later. In fact, the locals started shooting at a water tower which they believed to be a UFO. We still have the remains of this water tower today.

The reality was, it was all just a radio joke! We radio stations have a weird sense of humor, I understand. They decided to perform a version of HG Wells’ novel “War of the Worlds” on his nighttime show and because it was on the radio everyone thought it was a fact!

Local businesses still have fun with this story today and market their products accordingly. You will see signs saying “Aliens are coming here for our coffee” and so on. There is also a museum dedicated to this event. It’s a fun stop and story by the side of the road! If I were an alien I would totally land here now because no one will fall in the trap twice and I would be free to enjoy the city! If you want to take a road trip to the weird, head to Grover’s Mill, NJ and they will be happy to tell you all about it!
Listen to Lou & Shannon’s Mornings on 94.3 The Point and download our free 94.3 The Point app

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Leverage loans have averted the pandemic. Will it last? https://www.observingthesky.org/leverage-loans-have-averted-the-pandemic-will-it-last/ Tue, 09 Mar 2021 10:56:47 +0000 https://www.observingthesky.org/leverage-loans-have-averted-the-pandemic-will-it-last/

WASHINGTON – When the coronavirus pandemic hit the U.S. economy in March, some banking industry observers fears an explosion of faults on highly leveraged business loans. While such an explosion has not materialized, many observers believe the corporate debt market is not yet out of the woods.

The default rate on leveraged loans reached 4% in July, according to S&P Global, higher than the rate of 1% set a year earlier but far from the double figures that some had predicted following the crisis. A March report from Fitch Ratings predicted a cumulative default rate of 15% in 2020 and 2021.

Some have attributed these benign default numbers to tighter lending standards, higher fees for corporate borrowers, and lower overall leveraged loan issuance. Meanwhile, the corporate relief provided by the $ 2 trillion stimulus package in March helped stabilize credit quality, observers said.

But one lack of new fiscal stimulus could lead to higher default rates, experts warn.

“At some point in the New Year, you’ll see that some companies just… need some extra support,” said Ellen Snare, Partner at King & Spalding.

Leverage loans exploded following the 2008 financial crisis and are now estimated at a total from $ 1 trillion to $ 3 trillion. Regulators have repeatedly voiced concerns about lax underwriting driving the boom, although most of the exposure is in the non-banking sector.

Many saw the coronavirus crisis as having the potential to lay bare the risks in the leveraged loan market.

In the years of low interest rates following the 2008 financial crisis, a record number of companies went into debt, and the global leveraged loan market is estimated at from $ 1 trillion to $ 3 trillion.

Before COVID-19, the default rate on leveraged loans was remarkably low. And while the data has suggested that defaults could increase – and even exceed 4% in July by number of issuers, according to S&P Global – so far, they are not as far as they could be. originally feared when the pandemic plunged the US economy into a recession.

“I was a little surprised that there weren’t more defaults,” said Erik Gerding, professor at the University of Colorado School of Law.

But without more congressional support to bring economic relief to businesses, there could be a dangerous ripple effect, Snare said.

“If there is no fiscal stimulus available to them in the new year, and if lenders don’t see the coins the borrower is offering, there may not be enough support to keep them afloat, ”she said.

Banking regulators have long warned that leveraged loans could pose a risk to financial stability. Although some have said their concern centers on the steadily increasing share of non-banks in the leveraged loan market, data has shown that leveraged loans are on banks’ books. have increased steadily during the last years.

The Fed’s response to the pandemic – which included lowering interest rates to near zero and rolling out nearly a dozen emergency lending facilities – has so far helped contain defaults payment, said Walter Mix, head of the financial services practice at Berkeley Research Group and a former California banking commissioner.

“Of course, the low interest rate environment is a double-edged sword, where margins are drastically affected, but at the same time, low rates are helping many of these loans perform better than they would. otherwise, “he said. .

Snare said she believed most of the activity around leveraged lending that occurred in the third quarter was related to refinancing as opposed to new issuance.

This trend was also present in the second quarter, where the issuance of leveraged loans was about $ 113.8 billion, compared to $ 271.5 billion in the first quarter, according to Refinitiv LPC. Likewise, a recent report by law firm White & Case said second-quarter U.S. leveraged loan issuance totaled just under $ 145 billion, a sharp drop from 55.7 billion. % compared to the previous quarter and a decrease of 38% compared to the previous year.

Lenders tightened standards for all loan products at the start of the pandemic. Most banks reported having started implement stricter lending standards for borrowers in late March “as the economic outlook has changed” in light of news of the spread of COVID-19, the Fed said in its April summary of its opinion poll of key loan officers.

Heavily indebted borrowers who may have sought loans in the first half of 2020 may have encountered higher fees and lender-friendly protections, which may have caused them to seek help elsewhere.

Guaranteed loan bond managers are also paying more to borrow from bond investors than before the pandemic, which has kept leveraged loan issuance from rebounding, according to S&P Global.

But interest rates close to zero can still encourage lower-rated companies to take on more debt, Gerding said. And given the very uncertain economic outlook, it is unclear how soon many businesses will be able to repay these loans.

“The market has kind of rebooted, and it’s being used not only for the economic recovery, but actually to pay dividends to private equity investors,” Gerding said.

In the past, some policymakers have downplayed the risks that leveraged loans present to the banking system, arguing that it was primarily hedge funds, insurance companies, and other non-bank organizations that started out. loans. But banks are still exposed through prime brokerage, credit derivatives and investments in secured loan bonds, which are made up of leveraged loans.

“The problem is who lends to the CLOs? Who finances their business? Who conditions these CLOs and works on underwriting them and covering them? It’s still the banks, ”Snare said. “So to the extent that the CLOs themselves run into problems, the banks will have a corresponding balance.”

And for many banks, the leveraged lending space is “a gray area,” Mix said.

“In particular, there isn’t really any regulatory guidance or accounting literature that matches the situation institutions find themselves in,” he said. “It comes down to what is reasonable – whether the bank has a best practice level risk management process when it comes to credit. “

In addition, lawmakers were unable to agree on another round of fiscal stimulus after many of the law’s provisions on aid, relief and economic security expired at the end of July. against coronaviruses. And Fed officials, including Fed Chairman Jerome Powell, have warned the central bank is limited in its ability to respond to the crisis and called for more support from Congress.

“If there is no fiscal stimulus, I think there will be more defaults for lower rated companies,” Gerding said. “I think if there isn’t a fiscal stimulus, there will be a lot of pressure if the economy starts to falter, on the Federal Reserve, downsize its existing facilities, or even potentially create more facilities. “

Powell with Treasury Secretary Steven Mnuchin have repeatedly told lawmakers that they do not have the power to reallocate funds from the CARES Act or provide direct assistance to businesses on their own.

“I think that’s kind of what the Federal Reserve executives are afraid of,” Gerding said. “They are afraid of the lack of a tax deal and are afraid of being put in some sort of recurring lifeguard role.”

Financial institutions themselves have enough capital and liquidity to be able to absorb defaults, but that hasn’t worked out so far, Mix said.

“On the private equity side, there is a significant amount of capital, looking for opportunities, and within the banking system I also see significant liquidity,” he said. “However, I think the fiscal stimulus factor is important to ensure what I see as the stability of the system in the short to medium term.”

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