'Support Egypt' coalition to submit Senate draft law, amendments to House of Representatives law on Sunday    Egypt assigns EGP 36.7bn for 691 green projects in FY 2020/21    Egypt's confirms total COVID-19 cases up to 32612, with 1198 deaths    Egyptian expats narrate their stories of loneliness during pandemic    COVID-19 made death of loved ones crueller and more painful    Culture Ministry to present virtual theatre performances on YouTube    Raya Foods anticipates 20% growth in upcoming 5 years    ACUD to support developers in New Capital with flexible payment systems    Recent devaluation of Egyptian pound against US dollar normal, temporary: banking pundit    Tourism Minister prepares for gradual return of activities    Clashes, tear gas in Beirut as protests turn to riots    OPEC and allies reportedly agree to extend record production cut    Brazil Bolsonaro threatens to pull out of WHO as coronavirus    Iranian wedding party fuelled new coronavirus surge: Rouhani    Zimbabwe grain deficit seen widening to 1.17 mln tonnes    Investigations under way as a large fire destroys Amazon Distribution Warehouse in Southern California    India overtakes Italy's coronavirus passes as lockdown easing looms    North Korea threatens to permanently shut liaison office with South    Al-Sisi announces Cairo Declaration to end Libyan conflict    Egyptian state banks collect over $10 bln from high-yield savings product    Paris gallery seeks inspiration in ancient China's hats to enforce social distancing    US officials block police 'extreme tactics' as protests enter 12th day    Italian federation agrees to allow five substitutions in Serie A    Solskjaer talks up Manchester United mentality ahead of Tottenham match    Friday's prayer to be held at Cairo's Al-Hussein Mosque next week    Michael Jordan giving $100 million for racial equality, justice    Egypt Purchasing Managers Index increases 37% in May-Planning Ministry    Egypt, Belgium stress importance of bolstering bilateral ties    Jordan reopens mosques for socially distanced prayers    Dortmund's Sancho, Akanji fined for getting haircuts without face masks    Moroccan actor Youssef Kerkour scoops BAFTA nomination    Cairo Airport Museum receives artifacts ahead of planned opening    US prosecutors charge 3 more police officers over George Floyd killing    CAF draws timeline for resumed continental championships amid COVID-19    Egyptian Football star Ahmed Fathy's wife, daughters infected with Coronavirus    TSFE to develop, operate Bab Al-Azab historical area    Misusing the Nile    Sudan urges UN Security Council to encourage GERD parties to refrain from 'unilateral measures'    Egypt's Zamalek close to signing Angola's Papel in summer    We Are One: Global film festival launches amid pandemic    Zamalek re-hang ‘Real Club of the Century' billboard after removing CAF logo    Armed Forces neutralise 19 militants in North Sinai operations    Farwell to 89-year old Egyptian actor Hassan Hosny    Ethiopia says it won't accept Egypt's ‘historic rights' to Nile water    Egypt removes 484 illegal constructions and encroachments on Nile    Salah did not pressure administration to include players on team: Ghazal    Sisi congratulates Egyptians on occasion of Eid Al-Fitr    Egypt's 12 MPs came into contact with coronavirus infected parliamentarian    

Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.

Chinese developers raise funds at home to repay pricier offshore debt
Published in Amwal Al Ghad on 01 - 04 - 2020

Chinese property firms facing a wave of maturing debt will raise funds on the mainland to refinance their offshore borrowings as funding conditions loosen in the world's second-largest economy at a time when the dollar bond market is slumping, according to Reuters on Wednesday.
Companies traditionally refinance bonds where they are issued to lower foreign exchange and transaction costs, but the coronavirus outbreak and ensuing scramble for dollars triggered a jump in yields for Asian debt. That has made it too prohibitive for companies to sell bonds offshore.
High-yield, B-rated dollar bonds issued by Chinese developers have seen their yields jump to more than 13% from less than 6% at the end of February, official data shows.
Yields in China's bond market, on the contrary, dropped as authorities guided interest rates lower and pumped liquidity into the economy gridlocked by widespread restrictions to contain the spread of coronavirus. Shanghai's interbank benchmark rate Shibor fell nearly 50 basis points during the same period.
“We will go wherever is cheap to borrow and wherever is reasonable to do more (financing),” Guangzhou-based Agile Group's Chairman Chen Zhuo Lin said at an earnings conference last week.
Agile, which has not issued any offshore bonds so far this year, has an offshore refinancing gap of $900 million in 2020, the second highest in the industry, according to Bank of America.
Chen said the company would not rule out using dividends and internal capital to repay offshore debt, adding it was in talks to borrow offshore syndication loans, where interest rates were lower.
Developers such as Country Garden , the country's largest, and Hangzhou-based Greentown China also said they could reallocate their capital from onshore.
Longfor Group and Times China said they would focus on issuing corporate bonds in Shanghai, capitalising on China's loosening policy.
“The (Hong Kong) window now is not good, we won't issue bonds even when we have the quota,” said Country Garden CFO Wu Bijun. “Onshore channels are more smooth.”
Some developers, including Sunac China and Ronshine China , have taken advantage of the drop in dollar bond prices and repurchased some of their bonds from the open market.
Redsun Properties and Zhenro Properties said they would consider doing the same.
Analysts said they were not concerned about a spike in offshore defaults as most of the issuers were bigger companies that have multiple fund raising channels and many had sold dollar bonds in January when investor appetite was good. But risks for the smaller and weaker names would increase.
Regulatory approval is needed for companies to transfer onshore yuan to repay offshore bonds, but Bank of America analysts see scope for the regulator to approve remittances.
According to Moody's, its rated developers' total offshore issuance in March dropped to $3.7 billion from a record high of $16.5 billion in January, while onshore bond issuance increased to 18.4 billion yuan ($2.6 billion) in March from 10.9 billion yuan in February.
“Should markets stabilise, there should still be property developers looking to raise offshore USD financing,” Samantha Xie, J.P. Morgan's head of China debt capital markets, said. “We would expect the first batch of issuers to be industry leaders, the top names.

Clic here to read the story from its source.