Evergrande Makes $19 Million Onshore Bond Payment

China Evergrande Group made an onshore bond coupon payment on Tuesday amid worries about a potential offshore default by the debt-ridden developer later in the week. EGRNY up +1.06%.

• Evergrande’s flagship unit had remitted funds to pay an onshore bond coupon of $19 million.
• China’s second-largest developer needs to prioritize its limited funds towards the domestic market, where the risks are much higher for its financial system.
• The liquidity crisis at Evergrande has $300 million in debt and has missed a series of bond payments, adversely affecting the global markets. High-yield bonds issued by Chinese property developers have been hurt significantly.
• An Evergrande bond due for payment on March 23, 2022, will be officially declared in default if the company does not make payment on the bond due on September 23.
• Meanwhile, the offshore bond market has responded positively after the China central bank’s reassuring response and coupon payments of two major developers.