[ad_1]
Chinese developer Evergrande Group, which is struggling to raise funds, filed for suspension of onshore corporate bonds on September 16 following the downgrade the day before.
Evergrande’s real estate service provider and subsidiary, Hengda Real Estate Group, discovered on Wednesday that its bond was downgraded from AA to “A.”
According to Hender, rating agency China Chen Singh International (CCXI) has put both bonds and their issuers on a further downgrade watch list.
Henda has requested that land corporate bonds be suspended for one day.
When trading resumes on September 17, bonds traded on the Shanghai and Shenzhen exchanges will only be traded through limited bargaining transactions.
The latest application comes after a recent repeated freezing of transactions due to volatile transactions. Still, according to market analysts, recent outages may indicate an increased likelihood of defaults and debt restructuring.
In addition to real estate development, the Evergrande Group is interested in the sports, health and tourism industry as a whole. With over $ 300 billion in debt, the real estate giant is in a hurry to raise money as it is on the verge of collapse if current restructuring efforts fail.
The impact is expected to extend to both the real estate, banking and iron ore sectors.
Two weeks ago, CCXI downgraded Evergrande and its onshore bonds from AAA to AA, erasing the value of the bonds when attempting a repurchase transaction.
September 7, Fitch Ratings Flagged The company’s “probable” default.
In July, CCXI revised China’s real estate sector outlook for the first time from stable to negative.
Reuters contributed to this report.
Rita Lee is a reporter for The Epoch Times, focusing on topics related to China. She started writing the Chinese version in 2018.
[ad_2]