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The U.S., already wrestling with the economic challenges brought on by the COVID-19 pandemic, is on the precipice of a compounding crisis of evictions, as protections and payments extended to millions of people out of work begin to run out, the New York Times reported. The fallout is predicted to be devastating for the nation’s renters, who entered the pandemic with lower incomes, significantly less in savings and housing costs that ate up more of their paychecks. They also were more likely to work in the industries where job losses have been particularly severe. Many have been scraping by thanks to temporary government assistance and emergency orders that put many evictions on hold. But evictions will soon be allowed in about half of the states, according to Emily A. Benfer, a housing expert and associate professor at Columbia Law School who is tracking eviction policies. “I think we will enter into a severe renter crisis and very quickly,” Professor Benfer said. Without a new round of government intervention, she added, “we will have an avalanche of evictions across the country.” In many places, the threat has already begun. The Texas Supreme Court recently ruled that evictions could begin again. In the Oklahoma City area, sheriffs apologetically announced that they planned to start enforcing eviction notices this week. And a handful of states had few statewide protections in place to begin with, leaving residents particularly vulnerable as eviction cases stacked up.

Hertz Global Holdings Inc. paid more than $16 million in retention bonuses to senior managers, including its new chief executive, just days before it filed for bankruptcy on Friday, WSJ Pro Bankruptcy reported. The car-rental company said it agreed to pay a $700,000 bonus to Chief Executive Paul Stone, who was named to the post this month. Chief Financial Officer Jamere Jackson received $600,000 and Chief Marketing Officer Jodi Allen got $189,633, according to a regulatory filing yesterday. In all, Hertz said that it would pay $16.2 million in cash bonuses to about 340 employees in recognition of uncertainty the company and its employees face as a result of the coronavirus pandemic’s impact on travel. Proponents of such payments say they are needed to keep the best executives from jumping ship when they are needed most. Detractors say they are simply another way for top-level managers to enrich themselves. But with many businesses struggling to survive the coronavirus pandemic — Hertz’s revenue in April fell 73 percent from a year earlier — incentive bonuses based on financial metrics are essentially out of reach.

Shale driller Unit Corp. has filed for bankruptcy with a creditor-backed plan to trim more than $650 million in long-term debt from its balance sheet, the Wall Street Journal reported. Tulsa, Okla.-based Unit has agreed to swap out bond debt for equity in the reorganized business and has also lined up a $180 million exit facility to propel the business out of chapter 11 later this year, according to papers filed on Friday in the U.S. Bankruptcy Court in Houston. The company said that it has signed a restructuring support agreement outlining the plan backed by its senior lenders and holders of about 70 percent of its bond debt. Unit has also lined up chapter 11 financing that includes $36 million in fresh loans and would “roll up” as much as $96 million in prebankruptcy loans, court papers say. A roll-up vaults debt ahead of a bankrupt company’s other financial obligations in terms of repayment in chapter 11. The bankruptcy financing, which must be approved by a judge, includes a milestone that requires the bankruptcy court to confirm its chapter 11 plan in just under three months. Unit said its vendors and suppliers won’t be affected by the bankruptcy. A midstream business in which Unit owns a 50 percent stake, Superior Pipeline Co., isn’t included in the chapter 11.

Fraudsters are increasingly using pilfered credit-card numbers and phishing attacks to prey on overwhelmed consumers and banks during the coronavirus pandemic, the Wall Street Journal reported. There has been a big jump in attempted credit- and debit-card fraud since coronavirus shut down the U.S. economy earlier this year, according to Fidelity National Information Services Inc., known as FIS, which assists about 3,200 U.S. banks with fraud monitoring. The dollar volume of attempted fraudulent transactions rose 35 percent in April from a year earlier, FIS said, a trend that appears to be continuing in May. Most of the fraudulent transactions were caught before they hit cardholders’ accounts, FIS said, but the spike in attempts presents another challenge for consumers and their lenders muddling through the worst economic crisis since the Great Depression. Credit-card purchases have fallen over the past two months, and millions of out-of-work borrowers have stopped making their monthly payments. A rise in successful fraud attempts could lead to higher losses for card issuers and, ultimately, higher costs for consumers.

Amtrak is preparing to slash its workforce by as much as 20 percent in its upcoming fiscal year as the U.S.’s lone nationwide passenger railroad braces for a slow recovery to ridership that’s been gutted by the coronavirus pandemic, Bloomberg News. Amtrak projects ridership will return to just half of 2019 levels in its upcoming fiscal year beginning in October, Amtrak Chief Executive Officer William Flynn said in a memo to employees. The railroad has already reduced service and taken other cost-cutting measures amid a 95 percent decline in ridership and revenue but further reductions are needed to align with a sustained period of depressed demand, he said. “Congress expects us to operate like any other business — and while they have supported us with emergency funding for FY 2020, they are not going to support us endlessly to run mostly empty trains,” Flynn said. The workforce reductions will account for $350 million of a plan to slash operating costs by $500 million next year, Flynn said in a separate letter to top U.S. lawmakers on Monday. In that letter, Flynn said that the railroad would need nearly $1.5 billion in additional funding from congressional appropriators in addition to the internal cuts being planned and $1 billion in emergency aid provided by the $2.2 trillion virus stimulus bill.

Finance chiefs are asking lenders to waive some financial requirements or give them additional flexibility in how they account for coronavirus-related expenses so their companies don’t violate loan terms, the Wall Street Journal reported. Many companies have suffered severe declines in revenue and earnings amid the coronavirus pandemic, hurting balance sheets and potentially resulting in violations of loan and debt agreements, or covenants. Those terms can include hitting certain financial targets — for example, the ratio between net debt to earnings before interest, tax, depreciation and amortization, or Ebitda — and holding a specific amount of cash as reserve. Companies usually have to prove to their lenders on a regular basis they still meet those requirements. A consortium of 21 banks agreed to waive the covenant test until December 2021 for Cimpress PLC, said Sean Quinn, its chief financial officer. The Ireland-based owner of marketing and customized products provider Vistaprint raised $300 million in capital at the end of April. Cimpress previously discussed a waiver without raising capital, but decided the funds would provide it with more flexibility in negotiations. “Bringing in that capital allowed us to have a different set of discussions with banks,” Mr. Quinn said. Nearly 100 other public companies, including cinema operator Cinemark USA Inc., clothing retailer Hanesbrands Inc. and casino operator Wynn Resorts Ltd., through May 15 pursued waivers or amendments to existing loan agreements, according to Moody’s Investors Service, which tracks companies that have disclosed these changes in filings with securities regulators. Banks and other lenders are scrutinizing the long-term viability of businesses applying for changes to their terms on a case-by-case basis, said Ted Swimmer, head of corporate finance and capital markets at Citizens Financial Group Inc. “There is no playbook, but we are trying to get companies through this situation that is not anybody’s fault,” Swimmer said. At the same time, the bank is managing its own risk exposure, he said. “Businesses that were in trouble before the pandemic might not make it through to the other side.”

A Dunwood, Ga.-based company that makes leather belts and wallets for Target, Disney and Under Armour has filed for bankruptcy, the Atlanta Journal Constitution reported. Circa of America reported about $10 million in liabilities compared to about $622,000 in assets, according to a document filed on Friday in federal court in Atlanta. The company generated about $24 million in revenue last year, a 21 percent decline from 2018. Circa makes products that were sold under different brand names and for various retailers, including The Gap and Nordstrom. The coronavirus pandemic forced many retailers and malls to close for weeks, which pummeled sales. Another Circa customer, J. Crew, itself filed for bankruptcy earlier this month.Circa did not provide an explanation in court documents for its bankruptcy filing. An increasing number of U.S. companies have filed for bankruptcy in recent weeks, including JCPenney and Hertz rental cars, as the impact of COVID-19 is felt throughout the economy. Most of Circa’s largest creditors are foreign companies that supply the company with raw leather, finished leather goods and metal accessories. Some of its largest vendors are located in China, Mexico, Taiwan and Vietnam.

The European Union’s executive arm today laid out the details of a recovery package worth 750 billion euros, or about $826 billion, for its 27 member economies, especially those hit hardest by the coronavirus pandemic and lockdowns put in place to stop its spread, the New York Times reported. The program, which was presented by the European Commission president, Ursula von der Leyen, in an address to the European Parliament today, hinges on using its own budget to issue bonds in international capital markets, and then distributing the proceeds according to members’ needs. It is seen as a breakthrough for the bloc’s integration, even if it is a one-off. The fund will distribute €500 billion worth of grants — free money that will not be piled on to national debt — to all 27 member states, with Italy getting the largest slice, followed by Spain. European countries will also be able to apply for loans from a €250 billion pot, but that funding will come with conditions and it will count toward debt loads. Japan made similar moves on Wednesday as its cabinet approved more than a trillion dollars in stimulus funds, including a combination of subsidies to companies and people. The Parliament is expected to approve the measure next month. Japan’s proposal follows a raft of measures that the country passed in April. Taken together, the two packages would be equivalent to 40 percent of Japan’s economic output, Prime Minister Shinzo Abe said today.

Data from the Small Business Administration shows net weekly PPP lending has actually been negative since mid-May, as fewer firms applied for loans, and some borrowers returned funds, Reuters reported. All told, the SBA says that it had approved $512.2 billion in PPP loans as of May 21. That’s nearly $150 billion less than the $660 billion allocated to the program, which was designed to keep Americans on company payrolls and off unemployment assistance. Business owners first saw the program as a lifeline during the coronavirus crisis. They are now worried that confusing and changing rules may keep them from converting the money to a grant, meaning they will need to pay it back. To ensure forgiveness, for instance, firms need to spend three-quarters of the funds on payroll. But for some firms that doesn’t leave enough to cover overhead. Others don’t have enough work to justify rehiring many of their pre-crisis staff. A survey by small business lobbying group Main Street Alliance showed 55 percent of members who were PPP borrowers were worried about loan forgiveness. Potential borrowers are “uncertain when we are going to reopen, uncertain what the demand will look like, uncertain about use of the program funds,” said Bill Keller, president of Oakland-based Community Bank of the Bay. Another barrier to PPP use is competing stimulus programs. Workers who lose their jobs due to the virus get an extra $600 weekly through July as part of enhanced unemployment benefits passed in March, netting many service workers more than if they returned to a PPP-subsidized job.