As of the interest payment date last Thursday, global investors holding China Evergrande Group(3333.HK) US dollar bonds had not received interest payments from the real estate giant.
Evergrande can postpone payments and has a 30-day grace period, after which the bondholders can call it a default, but the company’s silence on the matter has made global investors wonder whether they will have to swallow large losses when a 30-day grace period ends.
If Evergrande finally fails to pay the interest, it will become one of the largest US dollar bonds to default in the history of the Asian markets.
On September 27th, 2021, shares of China’s Evergrande electric car unit (0708.HK) plunged as much as 26% after it warned that the company faced an uncertain future unless it got a swift injection of cash, yet the liquidity crisis of the embattled property developer (3333.HK) is worsening in other areas of its business.
With liabilities of around $305 billion, Evergrande has run short of cash and rapidly become Beijing’s biggest corporate headache. Investors worry that the collapse may pose systemic risks to China’s financial system and pervade the global markets.
The hard-stricken real estate developer is scrambling to raise funds to pay its many lenders and suppliers, as it is teetering between an inevitable collapse and a less likely prospect of a bailout by Beijing.
The financial crisis of the Evergrande Group is the inevitable result of the fabricated and fraudulent economy in Communist China and it’s also a clear signal that China’s economy is doomed to collapse.
Editor: Harvey (叶知秋) / PR: Marialu / Mr. Cow
Edited by：【Himalaya London Club UK】