Beijing For the heavily indebted Chinese real estate group Evergrande, a crucial deadline ends on Friday: the 30-day grace period for the repayment of an offshore bond with a volume of two billion dollars, which was actually due on March 23.
If the repayment is not made on time before the end of the grace period, the issuer of the bond, a subsidiary of the real estate group, is threatened with insolvency. In the past, Evergrande has often serviced its liabilities to offshore creditors at the last minute.
At the beginning of December, however, another Evergrande subsidiary owed interest even after a 30-day grace period had expired. The rating agencies Fitch and S&P rated this as a partial default.
In the event of a default on the bond that is now due, experts warn above all of the indirect consequences: Chinese confidence in the real estate market, which is central to the economy as a whole, is at stake. In addition, there is a risk of a crisis of confidence among international investors.
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