DEVELOPMENT FOR EVERGRANDE, COMPANY REPAYS BONDHLDERS
A person familiar with the situation stated on Thursday that certain bondholders of China Evergrande Group have received coupon payments from the embattled property developer, easing concerns about a possibly destabilising default.
Earlier this week, Chinese news site Callanish reported that many bondholders had received interest payments from three bond tranches that owed a total of more than $148 million in interest payments due last month but had a grace period that ended on Wednesday.
Because they were not authorized to speak to the media, the source declined to be identified. A request for comment from Evergrande was not returned.
Evergrande, the world's most indebted developer, has been missing deadlines in recent weeks as it deals with more than $300 billion in liabilities, $19 billion of which are international market bonds.
Failure to pay would have resulted in the company's formal default and triggered cross-default provisions for other Evergrande dollar debts, aggravating the world's second-largest economy's debt problem.
Evergrande's Hong Kong-listed shares had risen more than 9% by mid-morning on the news that the latest deadline had been reached. A financial crisis has weighed on the sector, threatening hundreds of projects, and the corporation, which also has coupon payments totaling more than $255 million due on December 28, has come under strain.
The market is also keeping an eye on rival Kaisa Group, which has $59 million in coupon payments due on Thursday and Friday. After Evergrande, Kaisa has the biggest offshore debt of any Chinese developer. Kaisa, which has missed a payment on a wealth management product, was downgraded by S&P to “CCC-” from “CCC+” with a negative outlook on Thursday, following a similar action by Moody’s.
The rating agency said Kaisa’s liquidity appears to be depleted, and it expects a default scenario is inevitable within the next six months. China’s property woes have rattled global markets since September despite Beijing’s efforts to reassure markets the crisis would not be allowed to spiral out of control. Regulators and government think-tanks have held meetings with developers in the past few weeks, and the market is expecting some easing in credit and housing policies to prevent a hard landing of the sector.
Besides, the Federal Reserve warned on Monday that stress in China's real estate sector "poses considerable risk to the US financial system." See details on westmoney
Contributor: Excel_Solver from westmoney
Submitted November 15, 2021 at 12:54AM by Torture2580 https://ift.tt/3CgNBOg
