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S&P Downgrades China’s Greenland Over Bond Extension

Ratings agency S&P Global downgraded Greenland to “selective default” on Wednesday after the state-backed property developer extended the maturity of $488 million in bonds

S&P Global downgraded Greenland Holdings last week but ranked it a notch higher to 'CCC' this week.
The Greenland Group sign is seen on its building in Beijing. A string of Chinese property developers have defaulted on their offshore debt obligations and have had their ratings slashed in the last year as a result of an unprecedented liquidity squeeze and slowing sales. File photo: Reuters.


Greenland Holdings, a state-backed Chinese property developer, extended the maturity of $488 million in bonds, prompting a ratings downgrade.

Ratings agency S&P Global downgraded Greenland to “selective default” on Wednesday. “We view the transaction as a distressed debt restructuring and tantamount to a default,” the ratings agency said in a statement.

Greenland faces a significant amount of offshore debt maturities over the next 12 months, totalling about $2.4 billion.

The group would have lacked the resources and funding options to fully repay the notes upon maturity had they not been extended, S&P Global said.

Among private developers, many players have already offered bond exchanges to ease their liquidity pressures while a few, including China Evergrande Group and Sunac have defaulted on some payments.

Greenland Holdings last week secured bondholders’ approval to extend the maturity of its 6.75% notes with an outstanding of $488 million by one year to June 25, 2023.

In a filing last month, the company said the group’s business operations, financial performance and short-term liquidity have been adversely affected by Covid-19 outbreaks across the country as well as the pandemic control measures.

Wu Zhengkui, general manager of Greenland’s finance department, told investors that the firm was “fully capable” of repaying on time three other bond tranches due later this year.

He said the June payment was affected by cashflow disruptions due to lockdowns since March, according to a memo seen by Reuters.



  • Reuters, with additional editing by George Russell




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George Russell

George Russell is a freelance writer and editor based in Hong Kong who has lived in Asia since 1996. His work has been published in the Financial Times, The Wall Street Journal, Bloomberg, New York Post, Variety, Forbes and the South China Morning Post.


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