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FRANKFURT, Nov 30: United States energy giant Enron Corp, expected to file soon for bankruptcy protection in US courts, has had its licence withdrawn for trading on the European Energy Exchange (EEX) announced on Friday.
“The management of EEX has decided to withdraw with immediate effect the licence” of Enron’s London-based unit, Enron Capital and Trade Resources, to trade on the EEX spot market, the exchange said in a statement.
At the same time, it had also suspended Enron Europe Xchange Trading from the futures market with immediate effect, the statement added.
“That means that neither company is allowed to trade until further notice,” EEX said.
On Thursday, Enron Europe, the London-based subsidiary of the US energy giant, went into administration — receiving protection from creditors under British law comparable to Chapter 11 bankruptcy in the United States.
COLLAPSE TO COST JAPANESE FIRMS $8BN: The expected collapse of United States energy giant Enron Corp. will cost four Japanese financial firms some one trillion yen ($8 billion), officials said on Friday.
The four asset management companies had 40.5 billion yen in euro-yen bonds issued by Enron, out of their total 3.3 trillion yen in money management funds, an official from the Investment Trusts Association of Japan told AFP.
“All the four companies sold Enron bonds yesterday because of Enron’s deep financial troubles,” the official said.
The four are Nikko Asset Management Co. Ltd., UFJ Partners Asset Management Co. Ltd., Japan Investment Trust Management Co. Ltd., and Sumisei Global Investment Trust Management Co. Ltd., the association said.
Nikko alone held 25.5 billion yen in Enron bonds out of its total 2.7 trillion yen in managed funds.
The four asset management firms will have to pay some one trillion yen to finance their cancellation orders in the wake of the Enron scare, the official from the investment association and the Japan Investment spokesman said.
The Nihon Keizai Shimbun newspaper said Nikko Asset Management alone received cancellations worth of one trillion yen on Thursday. The company spokesman declined to confirm the report.
ABN TO MAKE PROVISION: The Dutch banking group ABN Amro said on Friday it would make a provision worth 110 million euros ($98.2m) in the fourth quarter this year if the US Enron declares bankruptcy.
The figure does not represent the totality of the bank’s exposure in Enron, according to ABN Amro spokesman Jochem van de Laarschot, who did not disclose the full amount.
But analysts have estimated the bank’s exposure at between 200 and 300 million euros.
Meanwhile, Dutch banking and insurance group ING said it had a total unsecured exposure to Enron amounting to about $195m dollars (218m euros).
However, spokesman Ward Snijders declined to comment on whether the group would make a provision to cover potential losses.—AFP
