Capital One says it won't use CFTC waiver related to oil lending

WASHINGTON (Reuters) – U.S. lender Capital One Financial Corp (COF.N) said on Saturday it would not use a U.S. Commodity Futures Trading Commission (CFTC) waiver after commodity price volatility lifted the bank’s derivatives exposure toward a key regulatory threshold.

The exemption relieved the firm from a requirement to register as a “Major Swap Participant,” or MSP, even though its growing energy swaps exposure was expected to require that by the end of the next quarter. The CFTC had announced the relief for an unnamed lender two weeks ago, and Reuters later reported Capital One was the bank.

“We are not an MSP,” a spokesperson for the bank said in an emailed statement on Saturday.

The bank has “notified the CFTC that we will not rely on the waiver and will register if derivative volumes reach the MSP threshold.”

The registration is related to Capital One’s commercial lending to the oil and gas industry, a relatively small part of its overall business. The bank enters into commodity swaps with energy clients to help them mitigate the risk of energy price swings and the related borrowing risks.

While those trades typically do not bring the lender’s swaps exposure anywhere close to the CFTC’s registration threshold, a huge plunge in energy prices put it on track to hit the threshold by the end of the next quarter, the agency said in a letter on March 20.

The temporary waiver sparked worries that regulators are going too easy on banks in a bid to prop up lending, potentially exposing them to more risk down the road if energy prices do not rebound.

Following the 2007-2009 financial crisis during which several major institutions were toppled by their derivatives exposure, Congress created a slew of swap trading laws to reduce systemic risk and increase the visibility of the market.

Capital One’s commercial bank “does not engage in speculative derivatives trading” and its normal hedging activity has not changed, the bank spokesperson said on Saturday.

The bank enters into hedges with other banks to reduce exposure to commodity risk from its hedges with oil and gas clients, reducing exposure to commodity risk to “essentially zero, and we are subject to no outstanding margin calls,” the spokesperson said.

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UK PM Johnson's pregnant fiance had COVID-19 symptoms but on the mend

LONDON (Reuters) – Carrie Symonds, the pregnant fiance of British Prime Minister Boris Johnson, said she had spent the past week in bed with symptoms of the novel coronavirus but after seven days of rest felt stronger and was on the mend.

“I’ve spent the past week in bed with the main symptoms of Coronavirus. I haven’t needed to be tested and, after seven days of rest, I feel stronger and I’m on the mend,” Symonds said.

“Being pregnant with Covid-19 is obviously worrying. To other pregnant women, please do read and follow the most up to date guidance which I found to be very reassuring.”

Johnson said on Friday he was remaining in isolation with mild symptoms of COVID-19, including a raised temperature, seven days after he first tested positive for the new coronavirus which causes the respiratory disease.

Johnson, 55, and Symonds, now 32, announced in February that they were expecting their first child together and were engaged to be married.

After Johnson last month became the first leader of a major power to announce that he had tested positive, he went into isolation at a flat in Downing Street, though the couple normally live together.

Symonds is the first unmarried partner to live openly with a British leader in recent history.

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Trump says will ask Congress for more small business funds if money runs out

WASHINGTON (Reuters) – U.S. President Donald Trump said on Saturday he would ask Congress for more money to make loans to small businesses struggling with the economic fallout from the coronavirus outbreak if the original $349 billion allocated in a fiscal stimulus bill runs out.

“I will immediately ask Congress for more money to support small businesses under the @ppploan if the allocated money runs out,” Trump wrote in a post on Twitter.

The launch of the small business bailout fund has been rocky since it opened on Friday morning.

Tens of thousands of businesses have swamped lenders, community bankers have complained of an inability to access the Small Business Administration (SBA)’s system and the Treasury Department was still issuing updated guidance and form templates on Friday afternoon.

As of Friday evening, lenders originated more than 17,000 loans valued at about $5.4 billion under the program, Jovita Carranza, the administrator of the Small Business Administration, said in a tweet.

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UK extends condolences to family of 5-year-old who died from coronavirus

LONDON (Reuters) – British Cabinet Office Minister Michael Gove said his thoughts went out to the family of a 5-year-old child who died in hospital after being infected with the novel coronavirus.

The United Kingdom’s hospital death toll from the coronavirus rose by 20% to 4,313 at 1600 GMT on April 3, the health ministry said.

COVID-19 deaths in English hospitals made up 3,939 of the UK total. Those who made up the 637 daily rise in English deaths were aged between five years and 104 years old.

Of the 637, 40 had no known underlying health conditions. They were aged between 48 and 93 years old.

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Indian power grid operators scramble to prepare for Modi's 'lights off' plan

CHENNAI/MUMBAI (Reuters) – Prime Minister Narendra Modi’s appeal to citizens to switch off lights across India on Sunday to mark the coronavirus fight is generating a lot more work and some tough challenges for India’s power sector workers.

On Friday, Modi appealed to Indians to turn out their lights for nine minutes at 9 p.m. on Sunday to show solidarity amid the coronavirus lockdown with a show of lamps, candles and flashlights.

The appeal, however, set off alarm bells for those in charge of India’s power grid, prompting a flurry of orders to officials manning generation plants and managing grid load, amid concerns that a surge in voltage due to a steep dip in demand could harm the grid and cause widespread outages.

India’s Power System Operation Corp (POSOCO), which oversees the national power grid, ordered all senior officials to be present at generating stations, substations and load despatch centers across India between 6 p.m. and 10 p.m. on Sunday.

It advised engineers to start reducing output from baseload plants such as coal-fired power stations just ahead of 9 p.m. and ramp up generation from hydro and gas plants, typically used to address peak power demand, to manage the anticipated gyration in demand.

POSOCO expects consumption to dip by over 10% when Indians switch off lights, it said in an advisory sent to grid operators across the country, calling the expected reduction in load and rapid recovery, “unprecedented”.

POSOCO’s parent body, Power Grid Corp of India (PGRD.NS), asked regional electricity transmission center employees to be on “high alert,” as the lights out plan could “lead to outage of grid elements due to grid constraints”.

India’s Ministry of Power sought to allay concerns though, and said in a statement, “The Indian Electricity grid is robust and stable and adequate arrangements and protocols are in place to handle the variation in demand.”

Modi has ordered India’s 1.3 billion people indoors to avert a massive outbreak of coronavirus infections, but the world’s biggest shutdown has left millions without jobs and forced migrant workers to flee home to their villages.

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India’s power consumption has already plunged amid the lockdown to stem coronavirus cases – which rose to nearly 3,000 on Saturday. Some states are worried about the impact of the “lights off”.

Nitin Raut, the power minister of Maharashtra, a western state which consumes the most electricity in India, appealed to citizens to light lamps and candles, while keeping lights on to ensure proper functioning of the grid.

“Already the electricity demand and supply equation has been stretched,” said Raut, adding the possibility of grid failures “could not be ruled out.”

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OPEC+ meeting delayed as Saudi Arabia and Russia row over oil price collapse: sources

DUBAI/MOSCOW (Reuters) – OPEC and Russia have postponed a meeting due on Monday to discuss oil output cuts until April 9, OPEC sources said on Saturday, as a row between Moscow and Saudi Arabia over who is to blame for plunging crude prices intensified.

The delay came amid pressure from U.S. President Donald Trump for the Organization of the Petroleum Exporting Countries led by Saudi Arabia and its allies, a group collectively known as OPEC+, to urgently stabilize global oil markets.

Oil prices hit an 18-year low on March 30 due to a slump in demand caused by lockdowns to contain the coronavirus outbreak and the failure of OPEC and other producers led by Russia to extend a deal on output curbs that expired on March 31.

OPEC+ is now working on a deal to cut the production of oil equivalent to about 10% of world supply, or 10 million barrels per day, in what member states expect to be an unprecedented global effort including the United States.

Washington, however, has yet to make a commitment to join the effort and Russian President Vladimir Putin on Friday put the blame for the collapse in prices on Saudi Arabia – prompting a firm response from Riyadh on Saturday.

“The Russian Minister of Energy was the first to declare to the media that all the participating countries are absolved of their commitments starting from the first of April, leading to the decision that the countries have taken to raise their production,” Saudi Energy Minister Prince Abdulaziz bin Salman said in a statement reported by state news agency SPA.

Putin, speaking on Friday during a video conference with government officials and the heads of major Russian oil producers, said the first reason for the fall in prices was the impact of the coronavirus on demand.

“The second reason behind the collapse of prices is the withdrawal of our partners from Saudi Arabia from the OPEC+ deal, their production increase and information, which came out at the same time, about the readiness of our partners to even provide a discount for oil,” Putin said.

OPEC sources, who asked not be identified, said the emergency virtual meeting planned for Monday would likely now be postponed until April 9 to allow more time for negotiations.

OPEC sources later downplayed the Saudi-Russia row, saying the atmosphere was still positive, although there was no draft deal yet nor agreement on details such as a reference level from which to make the production cuts.

“The first problem is that we have to cut from the current production level now, not to go back to the one before the crisis,” one of the OPEC sources said. “The second issue is the Americans, they have to play a part.”

OIL RISES FROM LOWS

Oil recovered from the lows of $20 per barrel this week with Brent settling at $34.11 on Friday, still far below the $66 level at the end of 2019. Prices had their biggest one-day gain ever on Thursday when Trump said he expected Russia and Saudi Arabia to announce a major production cut.

The United States is not part of OPEC+ and the idea of Washington curbing production has long been seen as impossible, not least because of U.S. antitrust laws.

Still, the oil price crash has spurred regulators in Texas, the heart of U.S. oil production, to consider regulating output for the first time in nearly 50 years.

But U.S. Energy Secretary Dan Brouillette, in a call with oil industry leaders on Friday, did not mention the possibility of U.S. production cuts, a source who listened to the call said.

Russian Energy Minister Alexander Novak told Russian state media he understood that the United States had legal restrictions on output cuts but it should still be flexible.

Other oil producers that do not belong to OPEC+ have indicated a willingness to help. Canada’s Alberta province, home to the world’s third-largest oil reserves, is open to joining any potential global pact.

The International Energy Agency warned on Friday that a cut of 10 million bpd would not be enough to counter the huge fall in oil demand. Even with such a cut, inventories would increase by 15 million bpd in the second quarter.

Asked if he was considering tariffs on Saudi oil, Trump said late on Friday: “Tariffs are a way of evening the score … Am I doing it now? No. Am I thinking about imposing it as of this moment? No. But if we’re not treated fairly it’s certainly a tool in the toolbox.”

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Spanish hotel owner turns resort over to refugees during coronavirus crisis

MADRID (Reuters) – In a complex of holiday bungalows to the east of Madrid, Venezuelan refugees and homeless people have replaced the tourists, business meetings and wedding parties that usually fill the premises.

The owner of the La Ciguena resort has turned the facility over to some of Madrid’s most vulnerable families, after he had to close the hotel because of the coronavirus outbreak sweeping through Spain.

“Since we’ve arrived, they’ve attended to our every need,” said Stephanie Paez, an eight-month pregnant Venezuelan refugee accompanied by her partner and mother.

She said her aim was to find a job, an apartment and get her residency papers once the coronavirus crisis was over.

Spain is in strict lockdown as it battles one of the world’s worst coronavirus outbreaks. The country’s death toll has surpassed 11,000, second only to Italy. Bars, restaurants and shops selling non-essential items are closed.

The resort is housing 12 families with children, around 65 people, most of them Venezuelan refugees. Although the staff have been temporarily laid off while the complex is shut to paying visitors, they come in to help voluntarily.

Families receive breakfast, lunch and dinner and come to the dining room, which overlooks a lake, in a staggered schedule so they can keep a distance of two meters between people.

“We thought, ‘What can we do, we have to do something’ and it took one second to offer,” Miguel Angel Carnero, the manager of the La Ciguena resort, told Reuters.

“It’s a way to do our bit, to contribute during this pandemic” he said.

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US accused of ‘piracy’ over mask ‘confiscation’

The US has been accused of redirecting 200,000 Germany-bound masks for its own use, in a move condemned as “modern piracy”.

The local government in Berlin said the shipment of US-made masks was “confiscated” in Bangkok.

The FFP2 masks, which were ordered by Berlin’s police force, did not reach their destination, it said.

Andreas Geisel, Berlin’s interior minister, said the masks were presumably diverted to the US.

The US company that makes the masks, 3M, has been prohibited from exporting its medical products to other countries under a Korean-War-era law invoked by President Donald Trump.

On Friday, Mr Trump said he was using the Defence Production Act to demand that US firms provide more medical supplies to meet domestic demand.

“We need these items immediately for domestic use. We have to have them,” Mr Trump said at the daily Coronavirus Task Force briefing at the White House.

He said US authorities had taken custody of nearly 200,000 N95 respirators, 130,000 surgical masks and 600,000 gloves. He did not say where they were taken into US hands.

Mr Geisel said the diversion of masks from Berlin amounted to an “act of modern piracy”, urging the Trump administration to adhere to international trading rules.

“This is not how you deal with transatlantic partners,” the minister said. “Even in times of global crisis, there should be no wild-west methods.”

A ‘treasure hunt’ for masks

Mr Geisel’s comments echo the sentiments of other European officials, who have complained about the buying and diversion practices of the US.

In France, for example, regional leaders say they are struggling to secure medical supplies as American buyers outbid them.

The president of the Île-de-France region, Valérie Pécresse, compared the scramble for masks to a “treasure hunt”.

“I found a stock of masks that was available and Americans – I’m not talking about the American government – but Americans, outbid us,” Ms Pécresse said. “They offered three times the price and they proposed to pay up-front.”

As the coronavirus pandemic worsens, demand for crucial medical supplies, such as masks and respirators, has surged worldwide.

Earlier this week, the World Health Organization (WHO) said it was considering changing its guidance on whether people should wear face masks in public.

At present, the WHO advises that masks do not provide sufficient protection from infection to justify mass usage. But some countries have taken a different view, including the US.

On Friday, Mr Trump announced that the Centers for Disease Control (CDC) will now recommend that Americans use non-medical, cloth face coverings to help prevent the spread of the virus.

The US has 273,880 recorded cases of Covid-19, the highest number in the world by a large margin.

Covid-19, the disease caused by coronavirus, has affected more than one million people and killed almost 60,000 globally, the latest figures show.

‘Significant humanitarian implications’

In a separate development, 3M said the Trump administration had asked it to stop exporting US-made N95 respirator masks to Canada and Latin America.

The request had “significant humanitarian implications”, the company warned, and could prompt other countries to act in kind.

The company says it manufactures about 100 million N95 masks per month – about a third are made in the US, and the rest produced overseas.

President Trump said he had used the Defence Production Act to “hit 3M hard”, without providing additional details. The law dates back to 1950 and allows a president to force companies to make products for national defence.

Canadian Prime Minister Justin Trudeau told reporters on Friday that “it would be a mistake to create blockages or reduce trade”.

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Coronavirus fury after Democrats form committee to monitor Trump’s response

The majority party has argued that there are already enough oversight measures in place in the $2trillion (£1.6trillion) stimulus bill passed by Congress last week.

Pelosi announced on Thursday that she is creating a House Select Committee on the coronavirus crisis.

The committee will appoint both Democrats and Republicans, and will have subpoena power to seek information from the Trump administration.

The House Speaker said: “It would have subpoena power that’s for sure.

“It’s no use having a committee unless you have subpoena power, and we would hope that there would be cooperation because this is not a kind of an investigation of the administration it’s about the whole [response].”

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House Minority Leader Kevin McCarthy raised concerns at the proposal on Fox & Friends on Friday.

He said: “This isn’t about oversight, it sounds like pure politics.

“Let’s take care of the crisis at hand right now.

“We have five different oversights already looking at this and this is what she comes up with?”

The CARES Act passed last week includes a Pandemic Response Accountability Committee to locate and investigate waste and abuse of spending under the bill.

On Thursday President Trump attacked the Democrat response commenting: “I want to remind everyone here in our nation’s capital, especially in Congress, that this is not the time for politics, endless partisan investigations.

“Here we go again.

“They’ve already done extraordinary damage to our country in recent years.

“It’s witch hunt after witch hunt after witch hunt, and in the end it’s people doing the witch hunt who are losing — and they’ve been losing by a lot.

“And it’s not any time for witch hunts.”

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House Speaker Pelosi has told the Republican leadership the panel will be bipartisan.

It will be chaired by House Democratic Whip James C. Clyburn of Missouri.

Lawmakers have passed three relief packages to address fallout from the virus.

President Trump signed a $2trillion (£1.6trillion) bill last week to send checks to many Americans.

It also sets up a $500billion (£407billion) corporate liquidity fund and provides $377billion (£307billion) in aid to small businesses, among other provisions.

So far America has reported a quarter of the world’s 1,094,324 coronavirus.

As of Friday, America has confirmed 276,037 cases.

Of that number, 7,385 have died after contracting COVID-19.

New York has the most cases in the US, with 102,863 cases and 3,218 deaths.

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African migrants in Morocco wait for aid as coronavirus bites

RABAT (Reuters) – Thousands of African migrants without revenue during Morocco’s coronavirus lockdown could run out of money for food and essentials, and rights groups have urged the government to offer them the same cash help it has promised to citizens.

The North African country has imposed a month-long lockdown restricting movement to purchases of food or medicine and to staffing some key jobs, with 761 cases of the coronavirus confirmed, including 47 deaths.

Saddou Habi, 30, who came to Morocco two years ago from Guinea, and decided to stay rather than trying to reach Europe after getting a job in a restaurant, said his money will run out in 10 days.

“I have been helping my four other flat mates whose financial situation is worse than mine,” he said.

“We are respecting all measures to stop the spread of the coronavirus but we need urgent help to go through these difficult times,” he said.

The government has promised monthly support of about $120 a month to households where the main provider has lost work in the informal economy because of the lockdown.

At present, that aid will go to people with a “free health service” card available only to Moroccans. The government plans to roll it out to people who do not have the card, but has not said if this would be extended to migrants.

The state will also pay about $200 a month to workers in private companies who are registered with the state social insurance scheme.

It leaves most of the 50,000 migrants who have obtained official residency permits since 2013 without help. The far larger number of undocumented migrants, many of them homeless or seeking to pass through Morocco to reach Europe, face even less chance of assistance.

The National Human Rights Council and the Moroccan Association for Human Rights have urged the government to help. The finance ministry did not respond when asked if migrants would become eligible for state aid.

‘WE HAVE TO SHOW SOLIDARITY’

Habi has applied for a residency permit, but is still waiting for it to be issued. He lives in the poor Hay Nahda district of Rabat, where houses made of bare concrete blocks press up against each other.

Local rights groups and charities have distributed food in poor districts to both Moroccans and migrants, but the lockdown has made it harder to distribute such supplies.

Living conditions are worst for homeless sub-Saharans in northern Morocco, near the Spanish enclaves of Ceuta and Melilla, which migrants often try to reach across a thicket of high wire fences.

The majority of migrants work in the informal sector earning barely enough money to meet their basic needs for a day, said Ousmane Ba, a Senegalese migrant who heads a community group.

The government needs to do more to shelter homeless migrants living in the forests in northern Morocco and help them avoid contagion, he added, speaking by phone from the city of Nador, near Melilla.

So far, the government has put more than 3,000 homeless people, including migrants, into shelters located in schools, stadiums and other buildings for the duration of the lockdown.

“We are all in the same boat in the face of the coronavirus storm. We have to show solidarity with one another for all to be rescued,” Ba said.

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