Long-time Chief Executive Officer Ben Silbermann of Pinterest would step down, handing over the reins of the social media platform to Google...

Stock Market

Google executive to take over as a new CEO of Pinterest

Top accounting firm Ernst & Young has been slammed with a record $100 million fine from the US government...

Stock Market

Accounting firm gets 100 million fine for faulty regulations

The Indian rupee slipped into a fresh low today and extended losses against the US dollar.

Forex

The rupee tumbled to a new low against the dollar in the midst of an increase in crude oil price

Wall Street saw a sharp fall at its closing in a broad sell-off. Consumers' worries over recession have sparked up...

Stock Market

Wall Street Lose Balance after recession strikes growth fear among consumers’

Soaring inflation may be pushing the US economy into a deep recession. Last week's 0.75% interest rate hike by the Federal Reserve...

Stock Market

Inflation ringing the recession bell - Mohammed Shaheen

Stock Markets

16 Sept 2021

China Evergrande Suspending Onshore Bond Trading

The Index Today

China Evergrande’s Hengda Real Estate unit has been facing liquidity crisis and has announced to suspend trading of onshore corporate bonds.
The property developer has liabilities of over $300 billion and will begin to freeze bond trading due to stock market volatility. Evergrande is trying to secure funds as it tries to avoid a meltdown that will end in either a government bailout or a collapse.
According to market experts, the freezing of bonds reflect the possibility of defaults and restructuring. China Chengxin International, a rating agency in China notified the real estate company that its bonds had been downgraded to A from AA.
Hengda Real Estate will be suspending its onshore corporate bonds for one day and will resume trade on the 17th of this month. The bonds are to be traded through negotiated transactions only, a process which is usually seen before a default. The main aim of the new trading strategy is to control volatility and limit participation.
James Shi, debt analyst at Credit Analytics said, “The market is pretty certain Evergrande will default. A very low recovery ratio would be due partly to deep losses at many Evergrande’s non-core businesses, making them hard to liquidate.”
According to a report by CreditSights, the probability of liquidation remains low if the company defaults. Experts are worried that the debt crisis o Evergrande may affect other high yield issuers.

©Photo: Reuters

Clay pottery with table linens