Read more about Evergrande bondholders don’t expect coupon payment on Thursday: Report on Business Standard. Evergrande is due to pay $83.5 million in interest on a $2 billion offshore bond on Thursday and also has a $47.5 million dollar-bond interest payment next week.
HONG KONG/SINGAPORE (Reuters) – Some holders of China Group’s dollar have given up hope of getting a coupon payment by a key Thursday deadline and expect the property developer to provide more information in the coming month, a source familiar with the matter said. Evergrande, which epitomises the borrow-to-build business model and was once China’s top-selling developer, has run into trouble over the past few months as Beijing tightened rules in the property sector to rein in debt levels and speculation. Global markets are now on tenterhooks ahead of Evergrande’s payment obligations as there are fears its difficulties could pose systemic risks to China’s financial system, and possibly spill over to other markets. is due to pay $83.5 million in interest on a $2 billion offshore bond on Thursday and also has a $47.5 million dollar-bond interest payment next week. Both would default if the company, which has outstanding debt of $305 billion, fails to settle the interest within 30 days of the scheduled payment dates. The company has yet to make an announcement about its plans for Thursday’s offshore bond coupon payment and a company spokesperson did not respond to requests for comment. A person familiar with the matter said some bondholders were not holding out for any payment on Thursday but did expect to provide some clarity over the next month or so. Earlier on Thursday, Bloomberg Law reported that Chinese regulators had asked Evergrande executives to avoid a near-term default on its dollar and to communicate proactively with bondholders, citing people familiar with the matter. „They don’t want a default right now,“ said Connor Yuan, the head of emerging market flow credit trading for Asia at Goldman Sachs. „Given there is a 30-day grace period, I think today it’s very likely the coupon won’t be made but it is possible that they try to get a deal done in the next 30 days.“ The Wall Street Journal reported separately on Thursday that Chinese authorities were asking local governments to prepare for the potential downfall of Evergrande, China’s second-biggest property developer, citing officials familiar with the talks.
