Caixin
Caixin Global – Latest China News & Headlines

Home >

TRENDING
Beijing’s New Airport Invites Fierce Competition for Seoul and Paris Routes
China Welcomes International Institutions to Take Part in Belt and Road
Fosun Chairman Tells Jack Ma He’s Been ‘Thinking About Succession’
LATEST
Baidu and ByteDance Launch Tit-for-Tat Lawsuit War
Services Giant Meituan Unveils Multi-Company Ride-Hailing Fleet — But Leaves Didi Out
Star Student Suspected of Killing Mother and Hiding Body for Months Finally Arrested
Leading Chinese Pig Provider Expands Business in Vietnam
Lawsuit Filer Says CEO Offered Her a Job at E-Commerce Giant JD.com Before Alleged Rape
Alibaba, Pinduoduo Wash Up on U.S. Piracy List
Payment Firm Lakala Cheers Investors With Surge in Shenzhen Debut
Chinese Sports Info Platform Prepares to Go Public, Again
Biotech Firm Viva to Raise Up to HK$1.5 Billion in Hong Kong IPO
At Least Three Electric Vehicles Have Spontaneously Exploded in China This Week
Fallen Tech Star LeEco's Listed Arm Braces for Trading Suspension
Central Bank Dismisses Rumors, Says It Will Not Tighten or Loosen Monetary Policy
Yet Another Chinese Coffee Chain Joins the Fundraising Frenzy
Former EV Head Is Being Detained — But No One Knows Where or by Whom
China's Bytedance Gets Reprieve as Indian Court Lifts Ban on TikTok App
Pork Company That Once Offered to Pay Debt With Ham Gets Stock-Market Warning
Huawei Opens Cloud and AI Innovation Lab
Guangdong Public Hospital Probed in Deaths of Newborns
China Welcomes International Institutions to Take Part in Belt and Road
Former Guizhou Governor Gets 20 Years in Prison and $26 Million in Fines for Corruption

By Bloomberg / Feb 11, 2019 05:06 PM / Finance

Two large Chinese borrowers — one that’s already defaulted, and one that’s under pressure -- missed payment deadlines this month, underscoring the risks piling up in a credit market that’s witnessing the most company failures on record.

China Minsheng Investment Group Corp., a private investment group with interests in renewable energy and real estate, hasn’t returned capital to some holders of a yuan bond that it pledged to repay on Feb. 1, according to people familiar with the matter. And Wintime Energy Co., which defaulted last year, didn’t honor part of a debt repayment plan, separate people said.

The developments are significant because both companies were big borrowers, and their problems accessing financing suggest that government efforts to smooth over cracks in the $11 trillion bond market aren’t benefiting all firms. If China Minsheng ends up defaulting, it may rank alongside Wintime Energy as one of China’s biggest failures, with 232 billion yuan ($34.3 billion) of debt as of June 30, according to a ratings agency report.

“Chinese corporations’ expansion in the past few years has often been fueled by debt issuance, usually short-term borrowings, but their investment cycles are typically longer term,” said Shen Chen, a partner at Shanghai Maoliang Investment Management LLP. “The recent failures show that companies are still struggling to roll over their debt despite the recent easing measures.”

Calls to China Minsheng Investment’s financing manager went unanswered. Calls to Wintime Energy’s officer responsible for securities information disclosure went unanswered.

Shanghai-based China Minsheng Investment had planned to repay a 3 billion yuan bond on Feb. 1, three days after the maturity, Bloomberg News reported earlier. Wintime Energy, a coal miner based in Shanxi province, told investors it’s still seeking financing for payment of 20 percent of the principal on the defaulted bond, which was due on Feb. 6, said the people, who are not authorized to speak publicly and asked not to be identified.

Wintime, with a total debt of 63.2 billion yuan as of Sept. 30, was the second largest bond defaulter in China last year after CEFC Shanghai International Group Ltd. A liquidity crunch in the nation led to a record 119.6 billion yuan of local note delinquencies in 2018.

Related: Chinese Bond Defaulter’s Chairman Offers Personal Guarantee

Support independent journalism from China. Subscribe to Caixin Global starting at $0.99.

Share this article
Open WeChat and scan the QR code
Copyright © 2017 Caixin Global Limited. All Rights Reserved.