23 Sept 2021
Evergrande Reassures Redemption for Home & Wealth Products to Investors
The Index Today
China’s Evergrande Group has taken the initiative to reassure its retail investors that they may redeem their investment products. This step came as a priority over increasing fears of the giant’s upcoming interest payment dues.
Hui Ka Yan told reporters on Wednesday that the company has boosted stock price recently with the help of a coupon payment on an onshore bond. The stock rise is seen as the biggest single-day percentage rise since 2009.
With Evergrande’s worsening $305 billion debt payment obligations, investors have been on edge in recent weeks as it may effect financial systems everywhere. Due Thursday, Evergrande is obligated to cover $83.5 million in dollar-bond interest payments. And it coming weeks, the firm must pay $47.5 million interest payments.
Evergrande’s chairman has asked executives to ensure all properties and wealth products owned by retail investors to be redeemed. This step came after investors showed frustration and anger over losing their savings through the company’s properties and other products.
Ezien Hoo, credit analyst at OCBC Bank said, “Assuming this situation goes the way of debt restructuring…we think the retail investor nature of the wealth management products would be prioritized for social stability.”
Evergrande has been aware of growing negative sentiment amongst its investors as many homes remain unbuilt and workers unpaid. Retail investors have voiced their concerns over the current losses occurring. The property giant aims to provide reassurance to these investors before moving onto the issue of its creditors.