• Email Us: [email protected]
  • Contact Us: +1 718 874 1545
  • Skip to main content
  • Skip to primary sidebar

Medical Market Report

  • Home
  • All Reports
  • About Us
  • Contact Us

China Evergrande bonds suspended as prices slump

September 6, 2021 by David Barret Leave a Comment

September 6, 2021

By Andrew Galbraith

SHANGHAI (Reuters) – Bonds issued by heavily indebted developer China Evergrande Group plunged on Monday on growing investor worries over the company’s ability to pay its debts, prompting China’s stock exchanges to halt trading.

The Shanghai Stock Exchange said in a statement that it had temporarily suspended trading in China Evergrande Group’s 6.98% July 2022 corporate bond following “abnormal fluctuations.” The exchange had also suspended trading in the bond on Friday.

Shanghai exchange data showed the bonds sliding more than 25% to a low of 40.18 yuan after the resumption of trade on Monday afternoon, reflecting investor doubts that Evergrande will be able to repay investors in full on the bond’s maturity next year.

The company’s 5.9% May 2023 Shenzhen-traded bond, which was also suspended from trading, fell more than 35% after trading resumed on Monday afternoon.

The slump in bond prices on Monday comes after China Securities Depository and Clearing Co. (CSDC) on Friday effectively erased their value for use in collateral repo trading by reducing the “conversion ratio” of the July 2022 bond to zero, effective Sept. 7.

Other Evergrande bonds, including the May 2023 Shenzhen bond, had been included on a CSDC table of conversion ratios on Thursday for use on Sept. 6, but were not included in Friday’s table.

The conversion ratio determines leverage limits for repo financing given a specific bond pledged as collateral. CSDC is owned by the Shanghai and Shenzhen stock exchanges.

A director at a local brokerage said that the reduction in the conversion ratio was a “grey rhino” – a highly obvious yet ignored threat. “It was bound to happen.”

China Evergrande declined to comment.

Worries surrounding Evergrande, which has been scrambling to raise funds to pay lenders and suppliers, have spilled into broader concerns that a debt crisis could send shockwaves through China’s banking system.

On Friday, an index of high-yield Chinese dollar issuers fell to its lowest level since spring 2020.

(Reporting by Andrew Galbraith; Additional reporting by Clare Jim in Hong Kong; Editing by Shri Navaratnam and Emelia Sithole-Matarise)

Source Link China Evergrande bonds suspended as prices slump

David Barret
David Barret

Related posts:

  1. Best WordPress hosting of 2021
  2. Inflation shock and ECB hawks keep euro near 1-month high
  3. Soccer-Ronaldo claims world record with late late show
  4. U.N. warns catastrophe looms in Ethiopia’s north, urges government to end de facto aid blockade

Filed Under: News

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

  • Why Even Traveling Close To The Speed Of Light Is So Hard
  • Peer Into The Universe’s Distant Past Thanks To JWST’s Longest-Exposure Photo Yet
  • First Evidence For Chubby Cheeks In Dinosaurs Challenges Our Understanding Of How They Chewed
  • The 2021 “Heat Dome” Killed Her Mother. Now, She’s Suing The Oil Companies Responsible
  • Two Of The Most Destructive Termites Got It On, Sparking Hybrid Threat In Florida
  • The Mad Gasser of Mattoon: A Story Of Anxiety And Hysteria In America’s Heartland
  • Tourists Swimming With Orcas In Mexico As Tour Guides Exploit Legal Loopholes
  • Hells Canyon, The Deepest River Gorge In The US, Was Created Incredibly Recently
  • It’s The Perfect Time Of Year To See Noctilucent Clouds In The Twilight Skies
  • Hawaiian Volcanoes Have Erupted With Gold That Came From Earth’s Core
  • Why Do Some Australian Beaches Have Vinegar Stations?
  • 2-Year-Old Who “Loves A Challenge” Becomes Youngest Ever Member Of Mensa
  • How Bioacoustics Could Decode Howls And Give Us “A Peek Into The Language Of Wolves”
  • Ancient Inca Used A Mysterious String “Writing” System – And We’re Starting To Understand What It Said
  • In 2015, Over 200,000 Saiga Mysteriously Died In An Unprecedented Event: What Happened?
  • Vegans And Vegetarians Aren’t Who You Thought
  • How Does Tickling Work? We’ve Been Trying To Find Out For 2,000 Years
  • Watch Hawai’i’s Volcano Kilauea Shoot Lava 300 Meters Into The Sky
  • Scientists Propose Deliberately Infecting Another World With Life To See What Happens
  • Does The Human Brain Have A Finite Memory Capacity?
  • Business
  • Health
  • News
  • Science
  • Technology
  • +1 718 874 1545
  • +91 78878 22626
  • [email protected]
Office Address
Prudour Pvt. Ltd. 420 Lexington Avenue Suite 300 New York City, NY 10170.

Powered by Prudour Network

Copyrights © 2025 · Medical Market Report. All Rights Reserved.

Go to mobile version