China property firm Evergrande defaults for first time on US$1.2 billion in bonds: Fitch

China property firm Evergrande defaults for first time on US$1.2 billion in bonds: Fitch

9/12/2021 1:20:00 PM

China property firm Evergrande defaults for first time on US$1.2 billion in bonds: Fitch

BEIJING: Two major Chinese property firms have defaulted on US$1.6 billion worth of bonds to overseas creditors, Fitch Ratings said Thursday (Dec 9), as contagion spreads within the country\u0027s debt-ridden real estate sector. The Chinese government sparked a crisis within the property industry when it l

Evergrande's troubles first surfaced in the summer when it made clear how heavily leveraged the firm had become.The eye-watering figures shook China's credit markets because of the sheer size of the company and the potential fallout should it collapse.

You Must Definitely Watch! Here is Funny and Desperate That Moments

Last month, it missed its first foreign bond repayment, but there was a 30-day grace period attached. That ran out on Tuesday, with some bond owners complaining that they had yet to be repaid.Questions have swirled over whether Evergrande is simply too big to be allowed to fail, given that its collapse could send shock waves through the wider Chinese economy.

But signs now point to Beijing being willing to close the chapter on the 25-year-old real estate empire that has typified China's breakneck growth in recent decades.After Evergrande said last Friday that it may not be able to meet its financial obligations, the government summoned the company's founder and announced several moves that have given the clearest picture yet of Beijing's plans to end the crisis.

A new seven-strong"risk management committee" has been set up to manage the restructuring. Only two executives from the company are on the committee - others include officials from state entities.Guangdong's provincial government is also sending a working team to the company, which analysts at Jefferies said indicated a"potential takeover of Evergrande".

Fat, grouchy cat to join ducks & chickens mural art at Malay Heritage Centre on Jan. 22-23, 2022

Kaisa is China's 27th-largest real estate firm, a minnow compared to Evergrande.But its default will do little to calm investor nerves.According to Bloomberg News, before Thursday, at least 10 lower-rated real estate firms have now defaulted on onshore or offshore bonds since the summer.

Before Thursday, Chinese borrowers had defaulted on a record US$10.2 billion of offshore bonds, Bloomberg had reported, with real estate firms accounting for 36 per cent of those non-repayments.

Read more: CNA »

Explainer-Scientists struggle to monitor Tonga volcano after massive eruption

SINGAPORE : Scientists are struggling to monitor an active volcano that erupted off the South Pacific island of Tonga at the weekend, after the explosion destroyed its sea-level crater and drowned its mass, obscuring it from satellites. The eruption of Hunga-Tonga-Hunga-Ha\u0027apai volcano, which sits on the s

who's next?