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Interest payment at the last second: Evergrande pulls his head out of the noose

For the third time in a few weeks, the troubled real estate group was paying the last minute bond interest. Further payments are due in December.

The highly indebted real estate group China Evergrande has again im last Moment his head pulled out of the noose. Shortly before a grace period expires paid Evergrande interest charges to bondholders, as a source told Reuters news agency. It was the third time in a few weeks that Evergrande on the last Pusher Loan interest served.

For weeks, investors have feared that the debt problems of Evergrande and other real estate developers are shaking the entire financial system in China. In the short term Evergrande the worst averted, said the person familiar with the matter, who does not want to give his name because he is not allowed to speak to the media. “But there is still a long way to go before the problems are resolved. We are at an early stage.”

The now served interest charges for three bonds totaling 148 million dollars (128 million euros) were actually already im Due October. because Evergrande but not back then paid had started a 30-day grace period. Would have Evergrande If this deadline was not met either, there would have been a formal default and other dollar bonds would have been affected.

With the payment now made, Evergrande’s crisis is not over. Additional coupon payments of $ 255 million will be due in late December. The corporation owes more than $ 300 billion to investors, customers and suppliers. The smaller competitor Kaisa, which is also heavily indebted, is also in financial difficulties and has asked investors and banks for more time to pay coupons. This week, $ 59 million is due. The two companies could not be reached for comments.

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FED fears global repercussions

In the past few weeks the debt problems had the chinese Real estate companies also partly caused turbulence on stock markets in Europe and the USA. In the meantime, the US Federal Reserve is also looking at the People’s Republic with more concern. It cannot be ruled out that the global financial system could suffer if the problems there persisted, warned the monetary authorities. The central government in Beijing has so far held back with the support of the real estate sector, but has repeatedly stressed that it has the risks under control.

The analysts of the German Commerzbank assume that Beijing im Emergency intervenes. “In order to avoid massive contagion and prevent systematic risks, the chinese Authorities are likely to take some measures to give real estate developers some time to reduce the debt burden, “the experts wrote in a brief study. The real estate sector plays an important role in China and the government is apparently trying to prevent the entire economy from drifting. The outlook for Investors for the chinese The real estate sector remained bleak in the longer term, however, as decision makers in Beijing tried to reduce the importance of the industry.

(WHAT)

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