Friday, September 11, 2009

“JAL hoping DPJ doesn't cut loans (The Japan Times)” plus 3 more

“JAL hoping DPJ doesn't cut loans (The Japan Times)” plus 3 more

JAL hoping DPJ doesn't cut loans (The Japan Times)

Posted: 11 Sep 2009 02:17 PM PDT

Japan Airlines Corp., the recipient of three government bailouts since 2001, will find out soon if the rules have changed.

The Democratic Party of Japan, which takes power Sept. 16, pledged to cut what the next prime minister, Yukio Hatoyama, called "wasteful" government spending. JAL, with ¥235 billion in loans from the state-owned Development Bank of Japan, likely will seek more aid after it submits a midterm business plan by Sept. 30, according to analysts.

"I think it's wrong for the government to provide money to a private company," said Hirohisa Fujii, the DPJ's leading contender to become finance minister. "The question is where you draw the line."

JAL, Asia's biggest carrier by sales, posted a ¥99 billion loss in the first quarter, the most in at least six years, as business and leisure travel plummeted during the country's worst postwar recession. The government set up a panel of legal and academic experts last month to help restructure the carrier, which has eight unions and posted losses in three of the last four years.

"The government will probably give more money to JAL," said Mitsushige Akino, who oversees $645 million in assets at Ichiyoshi Investment Management Co. in Tokyo, which doesn't own the stock. "The DPJ has close ties to labor, so it would be difficult for JAL to have mass layoffs."

JAL President Haruka Nishimatsu is making a personal appeal to win customers. He stood outside one of the airline's sales offices Friday with other executives and staff to hand out promotional leaflets and ask passersby to fly JAL.

"We're in agreement with banks on the direction we're heading in," Nishimatsu told reporters. "We're working on plans to reduce routes that are not financially viable."

Sze Hunn Yap, a spokeswoman at JAL, declined comment on whether the carrier would apply for more financing.

The country's unemployment rate reached a record 5.7 percent in July. JAL had 47,526 employees at the end of March, compared with 33,045 at All Nippon Airways Co., Asia's second-largest airline by sales. JAL plans to cut 1,400 administrative jobs domestically, starting next month.

Hatoyama's DPJ defeated the Liberal Democratic Party by a landslide Aug. 30, ousting the party that has governed for all but 10 months since 1955. The DPJ platform pledged ¥16.8 trillion in economic stimulus by 2013 on child care, corporate tax cuts and tuition aid, while eliminating ¥9.1 trillion in public-works spending.

JAL's reorganization will be discussed in the Diet without "taboos," Hiroyuki Nagahama, shadow transport minister for the DPJ and a member of the Upper House, said before the party's election victory. He declined comment on possible aid for JAL after the DPJ's success.

The carrier, privatized in 1987, gets more than half its airline business from international travel. JAL had a 25 percent drop in overseas passengers in June, the biggest decline since outbreaks of severe acute respiratory syndrome and bird flu in 2003.

The airline predicted a full-year loss of ¥63 billion and is forecast to lose ¥82 billion, according to the median of 12 analyst estimates compiled by Bloomberg. Globally, the airline industry may lose $9 billion this year, according to the International Air Transport Association.

JAL's first-quarter loss has helped make it the worst performing stock in the Bloomberg Asia Pacific Airlines Index, with a 23 percent decline this year, compared with a 23 percent gain for the index.

"JAL needs to borrow another ¥100 billion at a minimum," said Yasuhiro Matsumoto, a credit analyst in Tokyo at Shinsei Securities Co. "It is very difficult for the government to walk away from JAL."

JAL plans to cut ¥195 billion in operating costs this business year by scrapping unprofitable routes, reducing fuel costs, lowering wages and shifting to smaller planes.

The carrier announced last month it was negotiating with shipping line Nippon Yusen K.K. to merge air-cargo operations by next April to cut costs. JAL also is considering reducing its stake in regional carrier Hokkaido Air System Co.

The airline is trying to persuade retirees to accept a cut in pensions that may exceed 50 percent, which JAL said would give it a one-time gain of ¥88 billion this business year. That gain is already factored into its forecast of a ¥63 billion loss this year.

More than 3,500 retirees out of approximately 9,000 intend to vote against the pension cut, according to an unofficial tally on a Web site run by The Committee to Consider the Revision of JAL's Pension Scheme. That's enough to block the cuts, as the Tokyo-based carrier needs a two-thirds majority to push them through.

JAL and ANA together account for about 90 percent of all domestic air travel within Japan. The DPJ will be forced to help JAL to avoid giving ANA a monopoly, Shinsei's Matsumoto said.

"If it wasn't an airline, it would go bust," Matsumoto said.

"It's difficult to have one airline dominate. The country needs at least two."

All Nippon Airways Co. said Thursday that the number of passengers on its group's international flights grew 3.5 percent in August from a year earlier to 383,454, rising for the first time since February last year thanks to the removal of fuel surcharges.

The airline also attributed the rise to easing concerns over H1N1 swine flu, as well as the issuance commencing in July of tourist visas to Chinese individuals, which contributed to a 17.1 percent increase in passengers on Japan-China flights in August.

"There appears to be a recovery trend, although the pace is gradual, as slumping demand seems to have bottomed out," ANA President Shinichiro Ito told reporters.

The airline said it expects the number of passengers using international flights to rise by 10 percent in September.

ANA also said it will launch a code-sharing flight connecting Tokyo's Haneda airport and Beijing with Air China Ltd. on Oct. 25.



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SBA Disaster Loans over $2.3 Million (Business Wire via Yahoo! Finance)

Posted: 11 Sep 2009 08:49 AM PDT

ATLANTA--(BUSINESS WIRE)--The U.S. Small Business Administration (SBA) announced today that it has approved over $2.3 million in federal low-interest disaster loans to Kentucky homeowners, renters and businesses who sustained damages from the severe storms, straight-line winds and flooding that occurred on August 4, 2009.

"Currently, 136 home and business disaster loans have been approved in the amount of $2,344,200 for affected victims," said Frank Skaggs, Director of SBA's Field Operations Center East. "We are pleased to be able to approve these loans so the residents and businesses of Kentucky can start to rebuild and resume their normal lives. I encourage anyone who has not completed their disaster loan application to do so and return the application as soon as possible."

Victims are urged to register with FEMA by calling 1-800-621-3362 (FEMA) or 1-800-462-7585 (TTY) for the hearing and speech impaired. If you were issued an SBA loan application, complete and return the application, even if you do not want a loan. If the SBA is not able to approve a home loan, you may be referred to FEMA for possible grant assistance.

Homeowners, renters, businesses and non-profit organizations of all sizes in Jefferson County, Kentucky are eligible to apply for SBA's physical disaster loans. Anyone who suffered damage to their automobiles in Jefferson County may also apply for an SBA disaster loan.

If a borrower does not know how much of their loss will be covered by insurance or other sources, the SBA will consider making a loan for the total loss up to its loan limits, provided the borrower agrees to use insurance proceeds to reduce or repay their SBA loan.

Disaster loans up to $200,000 are available to homeowners to repair or replace their damaged or destroyed primary residence. Homeowners and renters are eligible up to $40,000 to repair or replace damaged or destroyed personal property.

Businesses and non-profit organizations of any size may borrow up to $2 million to repair or replace damaged or destroyed real estate, machinery and equipment, inventory, and other business assets. SBA can also lend additional funds to homeowners and businesses to help with the cost of making improvements that prevent or minimize the same type of disaster damage in the future.

SBA also offers Economic Injury Disaster Loans (EIDLs) to help meet working capital needs of small businesses, and most private non-profit organizations of all sizes, for economic injury relating to the disaster. Small businesses and most private non-profit organizations in the following counties are eligible to apply for Economic Injury Disaster Loans: Bullitt, Hardin, Jefferson, Oldham, Shelby and Spencer counties in Kentucky; Clark, Floyd and Harrison counties in Indiana. EIDL assistance is available regardless of whether the business suffered any property damage.

Interest rates can be as low as 2.750 percent for homeowners and renters and 4 percent for businesses with terms up to 30 years. The SBA sets loan amounts and terms based on each applicant's financial condition.

Anyone affected by the disaster may obtain applications and program information by calling the SBA's Customer Service Center at 1-800-659-2955 (1-800-877-8339 for the hearing-impaired), Monday through Friday from 8 a.m. until 6 p.m. EDT, or by sending an email to disastercustomerservice@sba.gov. Business loan applications can be downloaded from the SBA Web site at www.sba.gov/services/disasterassistance. Completed applications should be mailed to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155.

Disaster victims may visit SBA's secure Web site at https://disasterloan.sba.gov/ela/ to apply for disaster loans.

The deadline for physical loan applications is October 13, 2009; the deadline for economic injury applications is May 14, 2010.

For more information about the SBA's Disaster Loan Programs, visit our Web site at www.sba.gov/services/disasterassistance.

Release Number: 09-688, KY 11844/11845



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June 17 flood victims eligible for Small Business Administration loans (Pittsburgh Tribune-Review)

Posted: 10 Sep 2009 09:02 PM PDT

Residents whose property sustained damage from flooding during a June 17 storm will have access to low-interest, long-term loans from the U.S. Small Business Administration, officials said Thursday.

The SBA approved a request by Gov. Ed Rendell for a disaster declaration for the region. Loans will be available in Allegheny, Westmoreland, Armstrong, Beaver, Butler, Cambria, Crawford, Fayette, Indiana, Somerset, Washington, Warren and Erie counties.

People can apply for low-interest loans of up to $200,000 for repairs or replacement of damaged or destroyed real estate, and up to $40,000 to repair or replace personal property. Interest rates are as low as 2.437 percent for homeowners and renters, and 4 percent for businesses, with terms up to 30 years.

The SBA will set up disaster-loan outreach centers in the Turtle Creek Municipal Building, 125 Monroeville Ave., and at the Hempfield Township Building, 1132 Woodward Drive. A third outreach center will be set up in Erie.

The centers will be open from 8:30 p.m. to 4:30 p.m. weekdays from Sept. 15-22; and from 9 a.m. to 3 p.m. on Saturday, Sept. 19.

Information and loan applications are available by calling 1-800-659-2955, or by e-mailing disastercustomerservice@sba.gov.

The Federal Emergency Management Agency this month rejected a request for an estimated $30 million of disaster aid for flood victims.



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More concerns over student loans system (V3.co.uk via Yahoo! UK & Ireland News)

Posted: 11 Sep 2009 08:00 AM PDT

Tory shadow university and skills secretary David Willetts has challenged the government over claims of continuing delays processing student loan applications reminiscent of last year's Education Maintenance Allowance and national curriculum fiascos. Skip related content

He demanded business secretary Lord Mandelson seek assurances about reports the system is experiencing problems processing applications and handling enquiries from worried students and their parents.

Student Finance England, run by the Student Loans Company, has taken over the processing of new applications from local authorities in England.

The Department for Business, Innovation and Skills said it has received complaints about delays handling telephone enquiries, and higher education minister David Lammy is in daily contact with the company, who are keeping him informed.

The firm has said some people are experiencing delays, but these are related to volumes of calls to its helpline and not due to problems with its system.

Willetts told Mandelson in a letter he is concerned because he is receiving letters and emails on a daily basis from students and their parents finding it hard to get accurate information about student support applications.

He said the new arrangements "do not appear to be working properly", adding: "There is a clear and substantial risk that new students will face serious problems at the start of the new university term."

He complained of lack of information about whether an application had started to be processed, insufficient information about the receipt and location of personal documents, repeated web site failures, with a lack of response from the company's helpline and an absence of accurate information about students' financial entitlement

He asked Mandelson: "Are you able to reassure all young people starting university this autumn who applied before the deadline that they will receive their full loan and grant entitlement at the start of the new term?"



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Posted by Rakhma at 5:47 PM

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