onsdag 22. september 2021

Evergrande vows to meet first debt deadline, allaying some fears of collapse

Chinese property developer Evergrande has said it would pay some of the bond interest due on Thursday, allaying fears of an imminent and messy collapse that had spooked investors. Markets in Taiwan and China reopened lower after a two-day break, catching up with a sharp sell-off around the world triggered by concern over Evergrande’s predicament.

But stocks picked up after the promise to repay an estimated 232 million yuan ($35.88m), buoyed the mood.  Evergrande is still due to pay $83.5m in interest on a separate US dollar bond, but the signal on Wednesday that it has at least some ready cash for creditors seems to have cheered investors.

“We are still trying to understand what this payment means for the other bonds but I imagine they would want to stabilise the market and make other coupon payments, given the close scrutiny,” said a source familiar with the situation told Reuters.