Evergrande of China: Default Crisis: International Capital Markets Association (ICMA)
China Evergrande:
On August 31, It warned that if liquidity problems worsened, could default .
Deterioration of cash flow is creating a virtuous cycle.
Suspend multiple projects:
Multiple projects were suspended due to delays in payments to suppliers and contractors.
In the last two months
Settled $ 3.9 billion to suppliers and contractors.
China Evergrande itself warns of the crisis of default.
There is no more crisis.
Asset sale status:
Evergrande of China has recently been
Bank holdings,
Shares held in the water business,
Five real estate projects, etc.
sold assets and raised more than $ 2 billion.
Consolidation of interest-bearing debt:
As of June, interest-bearing debt was $ 88 billion, down $ 22 billion from December.
However, this decrease is offset by the increase in accounts payable and contract debt.
Cash flow worsens:
Contract debt is primarily debt to pre-sold homebuyers.
Accounts payable and contract debt totaled $ 180 billion as of June.
Evergrande of China has run out of money.
If you come this far, you can’t do anything about it.
Accounts payable and contract debt totaled $ 180 billion as of June.
Foreign investors are at a disadvantage:
For overseas stock and bond holders,
He is in an extremely disadvantageous position because he can hardly claim the redemption of domestic assets in China.
Many dollar-denominated bonds are already trading at serious distressed levels.
International Capital Markets Association (ICMA):
China’s corporate bond issuance balance is $ 5.8 trillion.
It is the second largest after the United States ($ 10 trillion).
It is difficult for managers to completely remove “China” from their portfolio.
World view of Toshiyoshi Katsumata
http://hisayoshi-katsumata-worldview.com/archives/27371555.html
Evergrande’s Second Downgrade in Two Days Raises Fear of Default – Opera News
Fitch downgrades China Evergrande’s ratings, sees ‘probable’ default
https://jp.reuters.com/article/china-evergrande-ratings-fitch-idINL1N2QA02P