China tells banks debt-laden property developer Evergrande will not pay interest next week

Major banks in China have been told that developer Evergrande will not be able to make loan interest payments due next week. The debt-laden company is negotiating with banks to extend payments and roll over some loans. Evergrande shares have tumbled more than 80% this year. Protests against the firm have spread to more Chinese cities, after its offer of property and parking spaces -- instead of cash repayments -- was rejected by investors. With a colossal debt of over $300 billion, there are growing concerns that the crisis could hit the broader economy.



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[planeteuropa]

Already nearly 300 property companies in China have gone bankrupt. Not to mention countless suppliers of building materials and equipment.

[lukeaye]

This is what happens when you build castles on dessert sand on borrowed money. More to come.

[jamesl]

How is this surprise? This is not even a market crisis for China. Ever been to China? For years, I have been seeing blocks and blocks of unfinished + unoccupied condos in sub-urbans and rural areas, from 1st tier cities to 3rd tier cities. Insolvencies and non-payment are normal, especially in the huge shadow banking sector in China. The ones implicated are just the retail investors and private financial institutions who will probably have to suck it up at the end of the day. None of them will have the balls or ability to seek recourse beyond Evergrande to the regulators or state-banks, even though they are partially responsible due to poor market controls. If this gets out of hand socially, the authorities will just "isolate and shut down" the creditors. It is also fortunate that China bans any complex financial derivatives and thus the impact is likely localized rather than market collateral in damage like the US '08 crisis. Crisis? Investors? Good Luck.. I always find it funny that many foreigners (or Singaporeans) keep seeing China as a lucrative place to invest while the China locals have been trying ways and means to bring money out but are restricted by capital controls.

[ikm]

...and ya thought Lehman Brothers was a game-changer...

[xila-man]

As for the No protests allowed in China Propaganda, that has been debunked in this video🙄

[frankjimenez]

Did she say they are offering parking spaces

[cygnevara]

fair enough. these high iQ people need to be held accountable. no bailouts.

[makedredd]

Evergrande is Evergiven’s big brother. 🚢

[jovimathews]

LKY was cheated by Suzhou Industrial Park, and now this 🤷‍♂️

[ongman]

The domino effect on the entire Chinese and world economy is scary.

[Ex.zed.]

The castle of sand is starting to crumble. 👏

[pezinski]

If China recognized the Taliban in Afghanistan, then the world should recognize Taiwan as Taiwan. Come on man.

[cooldudecs]

China goes America goes... America goes China goes

[kenwang]

CCP will help pay the interest. Pooh is the person likes his face.

[swaminathangnanasambandam]

More real estate companies will follow, covid impact is coming out slowly. US has predicted this and brought down interest rate so low to save its realtors.

[th]

China criticized the 2008 bailout now they are doing the bailout, LOL

[twoful]

The authority just have to confiscate all the assets of the developer including it relative and friends then are over the projects and compensate those that are being cheated.

[ghostfmufasa]

Chinese brothers the CEO’s are responsible for these things but they never get arrested they always avoid punishment make sure these fuckers who gambled with your investment go to jail and suffer the consequences

[AniMaTheEarth]

When my insurance friend ask me to invest in CHINA, this is what I would fear. He said south east Asia returns are so little. I rather invest in my neighbors, glad I was right!

[shyamchabra]

Australia needs to learn a lesson from this!