:Turmoil at China's largest private developer Country Garden could set off a"vicious cycle" of financing stress on the country's real estate investment trusts , brokerage J.P. Morgan warned on Monday.
REITs would be forced to dip into their profits if they fail to honor payments on debts, analysts said, putting at risk nearly 2.8 trillion yuan worth of assets under the management. "Unlike banks, which have holding power and are able to roll over credit to wait for an eventual resolution, alternative financing channels such as trusts may default once trust investors are unwilling to roll over the products," J.P.Morgan analysts led by Katherine Lei said in a note.
China's property sector has been grappling with a liquidity crunch since late 2021 when China Evergrande Group collapsed and triggered a series of debt defaults.
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Country Garden shares slump to record low after onshore bond trading haltedMarkets are jittery as more developers default on bond payments amid no signs of stronger support measures from Beijing. Read more at straitstimes.com.
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JPM warns of higher risk for Chinese REITs after Country Garden's troublesBrokerage J.P.Morgan warned on Monday an estimated 2.8 trillion yuan ($385.78 billion) worth of assets under the management of Chinese real estate investment trusts (REITs) face higher risk following the debt payment delays by Country Garden.The Wall Street bank said it expects a 'vicious cycle' of real e
Source: ChannelNewsAsia - 🏆 6. / 66 Read more »