Fitch Ratings Downgrade Evergrande To Restricted Default Amid Non-Payment Of Coupons

The US credit rating agency Fitch Ratings on Thursday downgraded the Long-Term Foreign-Currency Issuer Default Ratings (IDR) of China Evergrande Group and its subsidiaries, Hengda Real Estate Group and Tianji Holding Limited, from "C" (distressed) to "RD" (restricted default) for inability to pay annual interest on bonds

MOSCOW (UrduPoint News / Sputnik - 09th December, 2021) The US credit rating agency Fitch Ratings on Thursday downgraded the Long-Term Foreign-Currency Issuer Default Ratings (IDR) of China Evergrande Group and its subsidiaries, Hengda Real Estate Group and Tianji Holding Limited, from "C" (distressed) to "RD" (restricted default) for inability to pay annual interest on bonds.

"The downgrades reflect the non-payment of coupons due 6 November 2021 for Tianji's USD645 million 13% bonds and USD590 million 13.75% bonds after the grace period lapsed on 6 December. The non-payment is consistent with an 'RD' rating, signifying the uncured expiry of any applicable grace period, cure period or default forbearance period following a payment default on a material financial obligation," Fitch posted on its website.

The agency added that it believes Evergrande "would be liquidated in a bankruptcy because it is an asset-trading company."

The China Evergrande Group is the second largest property developer in China. Since July, Evergrande has been on the verge of default after years of growth and active borrowing. Declining sales, a high-risk business model and Beijing's actions to curb a boom in the Chinese housing market pushed the company into crisis. In late June, Evergrande's debt was $304 billion.