China’s Country Garden missed interest payments sink bonds, raise fresh fears for property sector
China’s biggest property developer, Country Garden, defaulted on interest payments on dollar-denominated debt with a face value of $1 billion on Monday, sparking steep selling of its bonds and raising fresh fears about China’s highly indebted real estate sector.
The developer missed $22.5 million of interest payments that were due Monday, as the Wall Street Journal reported. Prices of the two bonds, that mature in 2026 and 2030, promptly fell below 8 cents on the dollar and remained at distressed levels on Wednesday. From the archive: Evergrande fears sink stock market: Here’s what investors need to know about the teetering property giant
That would mark its first interim loss since it went public in Hong Kong 16 years ago. As recently as six months ago, the company appeared to be in a position to get through China’s housing downturn without defaulting on its U.S. dollar bonds.
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