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China Says It Can Contain Economic Risks: Evergrande Update


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© Bloomberg. Workers carry wooden poles near apartment blocks under construction in the Nanchuan area of Xining, Qinghai province, China, on Tuesday, Sept. 28, 2021. China has urged financial institutions to help local governments stabilize the rapidly cooling housing market and protect the rights of some homebuyers, another signal that authorities are worried about fallout from the debt crisis at China Evergrande Group. Photographer: Qilai Shen/Bloomberg

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(Bloomberg) — China can contain risks posed to the nation’s economy and financial system by China Evergrande Group’s debt crisis, according to central bank Governor Yi Gang, amid deepening concerns for other developers. 

The property firm’s troubles “casts a little bit of concern,” Yi said at a virtual meeting of the Group of 30 on Sunday. “Overall, we can contain the Evergrande risk.” The comments came after the People’s Bank of China on Friday broke its silence on the crisis, saying risks were controllable and unlikely to spread. 

Amid signs of authorities’ growing unease about rising contagion risk from Evergrande’s liquidity woes, China is loosening restrictions on home loans at some of its largest banks, according to people familiar with the matter. 

Fears of contagion risks intensified over the past two weeks after a surprise default by Fantasia Holdings Group Co. and a warning from Sinic Holdings Group Co. that its default was imminent. 

Evergrande’s onshore real estate unit is scheduled to pay yuan bond interest due Tuesday. 

Key Developments:

  • China Breaks Silence on Evergrande, Says Risks Controllable 
  • China Eases Mortgages for Rest of Year Amid Evergrande Woes 
  • Evergrande Unit Is Scheduled to Pay Bond Interest Due Tues.
  • Hong Kong Regulator Starts Probe of China Evergrande Accounting
  • China Evergrande’s Hui Pledges 500 Million Shares as Security
  • Yuexiu Pulls Out of Purchase of Evergrande HK Building: Reuters
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China to Sell $4 Billion of Dollar Bonds, Least Since 2018 (8:30 a.m. HK)

China will sell global dollar bonds for the fifth straight year, a deal that’s attracting more scrutiny after Evergrande’s crisis roiled the offshore debt market in recent months. 

The Ministry of Finance plans to raise $4 billion from the offering in Hong Kong on Tuesday, a third less than the $6 billion in each of the past two years and the least since 2018, according to Bloomberg-compiled data. 

 

PBOC’s Yi Says China Can ‘Contain’ the Risk From Evergrande (8:30 a.m. HK)

People’s Bank of China Governor Yi Gang said authorities can contain risks posed to the Chinese economy and financial system from the Evergrande’s struggles. He was speaking at a virtual meeting of the Group of 30 on Sunday.

 

Evergrande dollar bond interest deadlines:

©2021 Bloomberg L.P.

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