Saudi Arabia Is Making a High-Risk $1 Trillion Bet on Tourism
The kingdom must overcome a conservative image and concern about human rights. Visit the desert oasis town of AlUla to understand the challenge.
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The kingdom must overcome a conservative image and concern about human rights. Visit the desert oasis town of AlUla to understand the challenge.
Jury selection was completed Friday for Donald Trump’s first criminal trial, setting the stage for opening arguments Monday in a New York case accusing the former president of falsifying business records to conceal a sex scandal before the 2016 election.
Higher-than-expected interest rates amid persistent inflation are perceived as the biggest threat to financial stability among market participants and observers, according to the Federal Reserve.
Fifth Third Bancorp jumped the most in four months, leading bank stocks higher, with Chief Executive Officer Tim Spence predicting that income from lending has bottomed out.
China’s securities regulator said it will encourage the nation’s companies to list in Hong Kong as it unveiled a package of measures to bolster the city’s position as an international financial hub.
May 16, 2018
Bloomberg News
,(Bloomberg) -- Home Capital Group Inc., the Canadian alternative lender that was bailed out by Warren Buffett’s Berkshire Hathaway Inc., received a commitment for a new credit line from two banks as backing from the billionaire investor expires next month.
The two-year C$500 million ($389 million) loan from two Canadian banks to Home Trust Company will replace a C$2 billion ($1.6 billion) credit line from Berkshire, Home Capital said in a statement Wednesday. Buffett stepped in to backstop Toronto-based Home Capital last year after it was found by regulators to have improperly disclosed falsified home-loan applications and short-sellers targeted the stock.
The new loan results in a lower aggregate cost than the existing facility, Home Capital’s Chief Financial Officer Brad Kotush said in a statement. “We have significantly reduced our reliance on demand deposits for funding.”
The terms of the new line of credit includes a 0.75 percent upfront commitment fee, 0.6 percent annual standby charge on any unused portion and an interest rate on the drawn portion equal to three-month the Canadian Deposit Offered Rate plus 150 basis points. Three-month CDOR stands at about 1.75 percent so the interest rate would be about 3.25 percent.
The previous credit agreement from Berkshire carried about a 9 percent interest rate on outstanding balances and 1 percent on the undrawn funds.
Berkshire didn’t immediately respond to a request for comment left with an assistant.
Home Capital shares have risen 59 percent in the past 12 months to C$14.13. Berkshire holds about a 20 percent stake, according to data compiled by Bloomberg.
To contact the reporter on this story: Natalie Wong in Toronto at nwong133@bloomberg.net.
To contact the editors responsible for this story: Daniel Taub at dtaub@bloomberg.net, David Scanlan at dscanlan@bloomberg.net, Jacqueline Thorpe
©2018 Bloomberg L.P.