June 7, 2023

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Evergrande looks to avoid default |  Financial issues

Evergrande looks to avoid default | Financial issues

Two investors who own two of the bonds have confirmed that they have received the payments. They reported to Bloomberg News on the basis of anonymity because they are not authorized to speak publicly.

Investors waited to see if the discredited developer would make interest payments totaling $148.1 million before the end of the 30-day grace period on Wednesday. Evergrande missed the first payment terms last month. It relates to three loans with maturities of 2022, 2023 and 2024.

The real estate giant was on the verge of default in October. But the company managed to prevent it. The fact that funds are still being transferred doesn’t mean the crisis in Asia’s largest junk bond issuer is over, given the group’s mountain of debt. A string of other developers have also had problems. The problems even spread to other parts of the credit market.

On Monday, two other Evergrande bondholders said they had not yet received loan payments that were officially due on Saturday. Again, a 30-day grace period applies before a missed payment is considered a default.

Evergrande has not yet responded to a request for comment. The Chinese authorities are trying to mitigate the effects of the broader crisis on the property market. However, there are still concerns. German creditor DMSA (Deutsche MarktScreening Agentur) previously announced that Evergrande wants to file for bankruptcy. DMSA is a German market researcher who owns Evergrande bonds. It also invites other interested investors to join the application.