China Evergrande Group remains silent on debt matured on September 23, a coupon on offshore debt of $ 84 million. Technically, the default is declared 30 days after non-payment, but local authorities have been asked to prepare for the worst anyway. Beijing will not come to the rescue of the $ 300 billion indebted real estate giant, but the Central Bank also intervened today to stabilize the system by injecting another $ 70 billion into the system.
The anxiety of foreign investors
Evergrande’s stocks and bonds traded lower following the 17% rally on September 23rd. The shares fell 7.1% to HK $ 2.48 in Hong Kong. China Evergrande New Energy Vehicle Group plummeted 23%. The dollar bond at 8.25% maturing in 2022 fell by 2.4 cents against the dollar to 29.6 cents.
Loading…
European banks are trying to reassure investors that their exposure is limited. Credit Suisse Group AG, which has subscribed the majority of Evergrande bonds among international banks over the past decade, has released statements showing that its wealth management unit funds did not hold much of the developer’s debt.
The risk of UBS Group AG is “immaterial” and limited to the execution of requests for collateral on margin loans, said managing director Ralph Hamers. Noel Quinn of HSBC Holdings Plc said at a Bank of America Corp. conference that he was not concerned about the bank’s direct links to China’s real estate sector.
Endless collapse of the stock on the stock exchange
Falling prices on its debt helped push yields higher on the Asian $ 400 billion high-yield bond market, where it is one of the largest borrowers.