Chinese dollar bond demand plummets under stress: Evergrande update – .

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Chinese dollar bond demand plummets under stress: Evergrande update – .


(Bloomberg) – Demand for Chinese dollar bonds slumped in September, as China Evergrande Group’s liquidity problems weigh on the primary offshore debt market.
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Orders for offers were 5.1 times their issue volume last month, the lowest since July and down from a one-year high of 7.7 in August, according to data compiled by Bloomberg statistics available on transactions. Dollar bonds also saw lower demand in Asia outside of Japan, with the underwriting ratio falling to 4.7 times in September from 6.9.

More than 24 hours have passed without any clarification as to whether struggling developer Evergrande made the interest payments due Oct. 11 on three of its dollar bonds. There is a 30 day grace period before any missed payment constitutes a default.

Evergrande’s next investor confidence test will take place on October 19, when 121.8 million yuan ($ 18.9 million) in interest will be due on a national bond. He then has to pay coupons for two dollar bonds on November 6.

Key developments:

  • Demand for Chinese dollar bonds collapses as stress on Evergrande increases
  • Hong Kong cancels stock trading due to Typhoon Kompasu
  • China Not “Dumb” Enough For Lehman Moment, Says StanChart CEO
  • Shimao Group deposits funds in USD bond buyback account
  • Chinese real estate market could cool further in Q4: Securities Journal

Yango’s Onshore Bonds Continue To Fall Despite Project Rumor Denied (2:17 p.m. HK)

Some of Chinese developer Yango Group Co.’s onshore bonds continued to fall on Wednesday, even after last week’s denial of social media discussions that a housing project had been halted.

Shimao deposits funds in USD bond buyback account (12:59 p.m. HK)

Shimao Group Holding Ltd. deposited funds into the trustee’s bank account for full redemption of the notes on Oct. 15 for an outstanding principal of $ 820 million, with interest accrued to the due date, according to an exchange document.

The developer’s investment-grade dollar bonds fell Wednesday morning, credit traders said.

Malaysia Says Banks Have Limited Exposure To Chinese Developers (12:57 PM HK)

Malaysian banks have limited exposure to Chinese developers and any fallout from the debt problems facing the country’s real estate sector will be manageable, according to Bank Negara Malaysia.

“From a financial stability perspective, Malaysian banks have limited direct exposure domestically or through their overseas operations to the real estate sector in China,” the central bank told Bloomberg on Tuesday evening. “The impact on Malaysian banks of any heightened credit risk resulting from recent developments in China should be manageable. “

Hong Kong cancels stock trading due to Typhoon Kompasu

Hong Kong suspended schools and the city’s $ 6.3 trillion stock exchange canceled trading on Wednesday as strong winds and rain from Typhoon Kompasu hit the financial center.

Beijing Delays Some Land Auctions As Market Cools, Securities Daily Says (8:13 a.m. HK)

Beijing postponed the auction of 26 lots while the city of Hangzhou canceled bids for 17 this week amid the government’s efforts to cool the housing market, Securities Daily reported, citing statements from cities.

China Not “Dumb” Enough For Lehman Moment, Says StanChart CEO (8:02 HK)

The Chinese government will not let the turmoil surrounding Evergrande turn into a systemic crisis, the CEO of Standard Chartered Plc said.

The lender, which focuses heavily on Asia, has no “exposure to the real estate sector,” Bill Winters said in an interview with Bloomberg Television recorded in London on Tuesday.

Evergrande Halt Has Nothing Over 11 Years: What To Watch In China (7:50 HK)

Evergrande’s trading halt has led to days without a statement from the company detailing the reason – and it’s all too familiar to Hong Kong traders who have had to go through dozens of similar episodes this year alone.

Some 81 Hong Kong board shares have been suspended for three months or more, according to exchange data as of September 30. Most were arrested in 2021, including China Huarong Asset Management Co. – the bad debt manager who rocked markets after delaying its earnings report. In the United States, suspensions are capped at just 10 days.

Chinese real estate market could cool further in Q4: Securities Journal (7:33 a.m. HK)

The real estate market faces cooling pressure in the fourth quarter as government property control policies remain tight, the China Securities Journal reported, citing unidentified research institutes.

Most developers became more cautious about their offerings in the second half of this year amid bleak funding prospects and declining gross margins for the industry as a whole, according to the report citing a research note from CSC Financial Co .

Interest terms for Evergrande dollar bonds:

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