Table ： Changes in defaulted corporate bonds
China: defaults on corporate bonds in 2019：12 times larger than 4 years ago (Wind)
Shanghai
January 10, 2020
Financial Research Company: Wontoku Information Technology (Wind): (See table)
In 2019, China’s defaults / total corporate bonds are increasing rapidly, rising 17.7% year-on-year.
China’s default amounted to 142,408 million yuan (about 2,278,528 million yen, 1 yuan = about 16 yen).
Four years ago, it increased about 12 times compared to 2015.
Default: Reasons for Expansion
In China, the number of companies that have suffered from financial difficulties is increasing rapidly.
Behind this were the slowdown in China’s economy and the impact of the US-China trade friction.
Default: Changes over time
2014-2018:
Default cases were mainly concentrated in the manufacturing industry, such as the chemical industry and machinery.
2019:
Manufacturing (35.6% of total),
Retail / Wholesale (19.5%),
Agriculture, forestry and fisheries (14.6%),
Transportation / warehouse (8.9%),
Defaults in other industries have become prominent.
Default: Regional trends
Looking at the homes of defaulting companies,
Beijing City (highest after 2018),
Jiangsu,
Liaoning Province continues.
SOEs / Private Enterprises: Recent Trends
Defaults by state-owned and private companies account for the majority.
Although state-owned enterprises are receiving preferential measures such as tax revenues and subsidies, more and more cases have recently fallen into default.
State-owned enterprise: Peking University Founder Group Corp
In December 2019, an IT-owned state-owned enterprise / Peking University Founder Group Corp was unable to repay corporate bonds.
Concerns about the financial situation of state-owned enterprises in general are growing.
Peking University Founder Group Corp : IT-owned state-owned enterprise with total assets exceeding 300 billion yuan and 6 listed companies under its umbrella
-JETRO
https://www.jetro.go.jp/biznews/2020/01/7ea6316c7194c4fc.html