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U.S. fighter jet shoots down suspected Chinese spy balloon

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A U.S. military fighter jet shot down a suspected Chinese spy balloon off the coast of South Carolina on Saturday, a week after it first entered U.S. airspace and triggered a dramatic — and public — spying saga that worsened Sino-U.S. relations.

President Joe Biden said he had issued an order on Wednesday to take down the balloon, but the Pentagon had recommended waiting until it could be done over open water to safeguard civilians from debris crashing to Earth from thousands of feet (meters) above commercial air traffic.

“They successfully took it down, and I want to compliment our aviators who did it,” Biden said.

Multiple fighter and refueling aircraft were involved in the mission, but only one — an F-22 fighter jet from Langley Air Force Base in Virginia — took the shot at 2:39 p.m. (1939 GMT), using a single AIM-9X supersonic, heat-seeking, air-to-air missile, a senior U.S. military official said.

China strongly condemned the military strike on an airship that it says was used for meteorological and other scientific purposes, and which it said had strayed into U.S. airspace “completely accidentally” — claims flatly dismissed by U.S. officials.

“China had clearly asked the U.S. to handle this properly in a calm, professional and restrained manner,” China’s foreign ministry said in a statement. “The U.S. had insisted on using force, obviously overreacting.”

The balloon was shot down about six nautical miles off the U.S. coast of the Atlantic Ocean, over relatively shallow water, potentially aiding efforts to recover elements of the Chinese surveillance equipment over the coming days, U.S. officials said.

One U.S. military official said the debris field was spread out over seven miles (11 km) of ocean, and multiple U.S. military vessels were on site.

The downing of the balloon came shortly after the U.S. government ordered a halt to flights in and out of three airports in South Carolina — Wilmington, Myrtle Beach and Charleston — due to what it said at the time was an undisclosed “national security effort.” Flights resumed on Saturday afternoon.

While Saturday’s shootdown concludes the military dimension to the spying saga, Biden is likely to continue to face intense political scrutiny from Republican opponents in Congress who argue he failed to act quickly enough.

A senior administration official said after shooting down the balloon, the U.S. government spoke directly with China about the action. The State Department also briefed allies and partners around the world, the official said.

Questions remain about how much information China may have gathered during the balloon’s trek across the United States.

The balloon entered U.S. airspace in Alaska on Jan. 28 before moving into Canadian airspace on Jan 30. It then re-entered U.S. airspace over northern Idaho on Jan. 31, a U.S. defense official said. Once it crossed over U.S. land, it did not return to open waters, making a shootdown difficult.

U.S. officials did not publicly disclose the balloon’s presence over the United States until Thursday.

“It’s clear the Biden administration had hoped to hide this national security failure from Congress and the American people,” said U.S. Representative Mike Rogers, a Republican who leads the House of Representatives Armed Services Committee.

Biden’s emphasis on Saturday that — days ago — he ordered the balloon shot down as soon as possible could be an effort to respond to such critics.

Former President Donald Trump, Biden’s potential rival in the 2024 election, called earlier this week for the balloon to be shot down, and has sought to portray himself as stronger than Biden on China. The U.S. relationship with China is likely to be a major theme of the 2024 presidential race.

Washington had called the balloon’s appearance a “clear violation” of U.S. sovereignty and notified Beijing about the shootdown on Saturday, a U.S. official said.

Still, officials on Saturday appeared to play down the balloon’s impact on U.S. national security.

“Our assessment — and we’re going to learn more as we pick up the debris — was that it was not likely to provide significant additive value over and above other (Chinese) intel capability, such as satellites in low-Earth orbit,” the senior U.S. defense official said.

A Reuters photographer who witnessed the shootdown said a stream came from a jet and hit the balloon, but there was no explosion. It then began to fall.

The Pentagon assesses that the balloon was part of a fleet of Chinese spy balloons. On Friday, it said another Chinese balloon was flying over Latin America.

“Over the past several years, Chinese balloons have previously been spotted over countries across five continents, including in East Asia, South Asia and Europe,” the U.S. official said.

The suspected spy balloon prompted Secretary of State Antony Blinken to postpone a visit to China this week that had been expected to start on Friday.

The postponement of Blinken’s trip, which had been agreed to in November by Biden and Chinese President Xi Jinping, was a blow to those who saw it as an overdue opportunity to stabilize an increasingly fractious relationship between the two countries.

China is keen for a stable U.S. relationship so it can focus on its economy, battered by the now-abandoned zero-COVID policy and neglected by foreign investors alarmed by what they see as a return of state intervention in the market.

Source: Reuters

BIZ

HNB finance depositors in jeopardy due to ‘PrimeMax’ 0.5% scheme

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A controversial real estate financing model, ‘PrimeMax’, introduced by Prime Lands for apartment buyers, is allegedly putting both buyers and HNB Finance depositors at significant financial risk.

This is because Prime Lands, which holds a 38% stake in HNB Finance, is leveraging its shareholder power to aggressively direct public funds into high-risk, speculative real estate loans.

Experts warn that this move not only violates CBSL’s risk diversification regulations but also exposes HNB Finance to significant liquidity risks.

Traditionally, HNB Finance operates in the microfinance sector, which relies on fast cash flow and frequent repayments.

However, this real estate loan model contradicts the principles of microfinance by front-loading funds into high-value condominium projects and locking capital into long-term, high-value loans with slow repayment cycles. This shift undermines the company’s liquidity, putting both the financial stability of HNB Finance and the security of its depositors’ funds at significant risk.

How the ‘PrimeMax’ 0.5% payment scheme works:

  • 10% Down Payment: Buyers pay only 10% of the total property value upfront.
  • 47.5% Bank Loan: HNB Finance funds nearly half of the property value through a loan.
  • Interest-Only Payments for 3 Years: Buyers pay just 0.5% per month, primarily covering interest with minimal reduction in the principal.
  • Additional 15% Paid as Interest: Over the 3-year period, buyers will have paid an additional 15% of the sale value as interest.
  • Outstanding Balance After 3 Years: After the 3-year period, approximately 75% of the total property value remains unpaid. This balance consists of the remaining loan amount owed to HNB Finance, along with the outstanding balance owed to Prime Lands.

Financial trap for apartment buyers

Prime Lands markets this scheme as a flexible investment opportunity, but economic experts say it is actually a debt trap that locks buyers into long-term loans.

Crippling debt even after 3 years : With more than 75% of the property price left unpaid, buyers will be burdened with a massive financial liability. This overwhelming debt will make it nearly impossible to secure refinancing or sell the property at a reasonable price.Even after 03 years, buyers will still owe roughly 75% of the property’s price, which makes refinancing or reselling at fair value very difficult.

The buyback & resale scam : Meanwhile, the promised opportunity to resell at a higher value is highly speculative and unreliable.  Project delays, unfavorable market conditions, and low demand can make reselling impossible, leaving buyers stuck in a property they can’t sell.

With these limited options, they may be forced into the buyback scheme-often at a price far below market value, resulting in significant financial losses rather than the anticipated profits.

Threats to HNB finance depositors

This flawed financing structure does not only impact buyers – it directly threatens the financial stability of HNB Finance customers and depositors:

  • Liquidity Challenges: With loan repayments delayed, HNB Finance may struggle to maintain its financial commitments, putting depositors’ funds at risk.
  • Risk of Defaults: If apartment buyers default due to high outstanding balances, HNB Finance could face serious financial losses, ultimately jeopardizing its depositors’ security.
  • Regulatory Violations: The Central Bank of Sri Lanka enforces strict lending policies for finance companies. This scheme raises concerns about compliance, as it prioritizes aggressive sales over responsible lending practices.The shift from microfinance to large-scale property lending could also push HNB Finance beyond regulatory limits for exposure to a single sector.

CBSL must intervene to protect public funds and depositors

The Central Bank of Sri Lanka (CBSL) enforces strict Risk Diversification Regulations for licensed finance companies to prevent excessive exposure to any single sector, ensuring depositor safety and financial stability.

However, HNB Finance PLC is dangerously violating this principle by diverting a significant portion of its funds into speculative real estate loans under the Prime Lands 0.5% scheme.

Unlike commercial banks, finance companies rely heavily on public deposits, making it crucial for them to maintain liquidity and prudent lending practices.

By over-lending to real estate, HNB Finance not only concentrates risk in a volatile sector but also compromises depositor funds, increasing the chances of liquidity shortfalls and defaults.

If this reckless lending continues, HNB Finance risks breaching CBSL’s sectoral exposure limits, leading to severe financial instability.

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HNB finance depositors in jeopardy due to ‘PrimeMax’ 0.5% scheme

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A controversial real estate financing model, ‘PrimeMax’, introduced by Prime Lands for apartment buyers, is allegedly putting both buyers and HNB Finance depositors at significant financial risk.

This is because Prime Lands, which holds a 38% stake in HNB Finance, is leveraging its shareholder power to aggressively direct public funds into high-risk, speculative real estate loans.

Experts warn that this move not only violates CBSL’s risk diversification regulations but also exposes HNB Finance to significant liquidity risks.

Traditionally, HNB Finance operates in the microfinance sector, which relies on fast cash flow and frequent repayments.

However, this real estate loan model contradicts the principles of microfinance by front-loading funds into high-value condominium projects and locking capital into long-term, high-value loans with slow repayment cycles. This shift undermines the company’s liquidity, putting both the financial stability of HNB Finance and the security of its depositors’ funds at significant risk.

  • 10% Down Payment: Buyers pay only 10% of the total property value upfront.
  • 47.5% Bank Loan: HNB Finance funds nearly half of the property value through a loan.
  • Interest-Only Payments for 3 Years: Buyers pay just 0.5% per month, primarily covering interest with minimal reduction in the principal.
  • Additional 15% Paid as Interest: Over the 3-year period, buyers will have paid an additional 15% of the sale value as interest.
  • Outstanding Balance After 3 Years: After the 3-year period, approximately 75% of the total property value remains unpaid. This balance consists of the remaining loan amount owed to HNB Finance, along with the outstanding balance owed to Prime Lands.

Prime Lands markets this scheme as a flexible investment opportunity, but economic experts say it is actually a debt trap that locks buyers into long-term loans.

Crippling debt even after 3 years : With more than 75% of the property price left unpaid, buyers will be burdened with a massive financial liability. This overwhelming debt will make it nearly impossible to secure refinancing or sell the property at a reasonable price.Even after 03 years, buyers will still owe roughly 75% of the property’s price, which makes refinancing or reselling at fair value very difficult.

The buyback & resale scam : Meanwhile, the promised opportunity to resell at a higher value is highly speculative and unreliable.  Project delays, unfavorable market conditions, and low demand can make reselling impossible, leaving buyers stuck in a property they can’t sell.

With these limited options, they may be forced into the buyback scheme-often at a price far below market value, resulting in significant financial losses rather than the anticipated profits.

This flawed financing structure does not only impact buyers – it directly threatens the financial stability of HNB Finance customers and depositors:

  • Liquidity Challenges: With loan repayments delayed, HNB Finance may struggle to maintain its financial commitments, putting depositors’ funds at risk.
  • Risk of Defaults: If apartment buyers default due to high outstanding balances, HNB Finance could face serious financial losses, ultimately jeopardizing its depositors’ security.
  • Regulatory Violations: The Central Bank of Sri Lanka enforces strict lending policies for finance companies. This scheme raises concerns about compliance, as it prioritizes aggressive sales over responsible lending practices.The shift from microfinance to large-scale property lending could also push HNB Finance beyond regulatory limits for exposure to a single sector.

The Central Bank of Sri Lanka (CBSL) enforces strict Risk Diversification Regulations for licensed finance companies to prevent excessive exposure to any single sector, ensuring depositor safety and financial stability.

However, HNB Finance PLC is dangerously violating this principle by diverting a significant portion of its funds into speculative real estate loans under the Prime Lands 0.5% scheme.

Unlike commercial banks, finance companies rely heavily on public deposits, making it crucial for them to maintain liquidity and prudent lending practices.

By over-lending to real estate, HNB Finance not only concentrates risk in a volatile sector but also compromises depositor funds, increasing the chances of liquidity shortfalls and defaults.

If this reckless lending continues, HNB Finance risks breaching CBSL’s sectoral exposure limits, leading to severe financial instability.

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High Posts committee approves appointments of 4 ministry secretaries

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The Committee on High Posts, which met recently in the Parliament under the patronage of the Prime Minister – Dr. Harini Amarasuriya, has given its approval for the appointment of 04 secretaries for ministries.

Accordingly, the following appointments have been approved :

Prof. K. T. M. Udayanga Hemapala – Secretary to the Ministry of Energy 
K.M.G.S.N. Kaluwewa – Secretary to the Ministry of Education, Higher Education, and Vocational Education
S.M. Piyatissa – Secretary to the Ministry of Labor
K.D.R. Olga – Secretary to the Ministry of Women and Child Affairs

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