Chinese real estate bond company after Kaisa and Sunac make coupon payments


HONG KONG (Reuters) – Chinese real estate bonds remained firm on Tuesday after two major developers made coupon payments, although the market remained focused on the potential default of the China Evergrande group this week.

The bond market responded positively to comments from China’s central bank on Friday and Sunday, saying the ripple effects of Evergrande’s debt problems on the banking system were manageable and that the Chinese economy was “doing well” .

Sunac China, which has a payment of $ 27.14 million due Tuesday, has paid its bondholders, a source with direct knowledge of the matter said.

The source was not allowed to speak to the media and declined to be identified. A representative for Sunac did not immediately respond to the request for comment.

Kaisa Group announced on Monday that it had paid a coupon due on October 16 and that it plans to transfer funds for a coupon worth $ 35.85 million due October 22 on Thursday.

The liquidity crisis in Evergrande, China’s second-largest developer, which has $ 300 billion in debt and missed a series of bond payments, has rocked global markets. High yield bonds issued by Chinese real estate developers have been particularly hammered.

An Evergrande bond due March 23, 2022 will be officially in default if the company does not repay after a 30-day grace period for a missed coupon payment that was due on September 23.

Chinese promoters’ bonds that won on Tuesday included Modern Land’s 2022 bonds which rebounded more than 8% to 40.250 cents against the dollar, while Central China Real Estate’s 2024 bonds climbed more than 5% to 44.843 cents.

Small developer Sinic Holdings defaulted on $ 246 million in bonds as scheduled on Monday. He had warned of the default last week, saying he did not have sufficient financial resources.

(Reporting by Clare Jim; Editing by Edwina Gibbs)


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