The lending crisis facing the Chinese real estate market intensified on Tuesday after a developer failed to keep its funds as Evergrande’s world’s largest financial group extended its suspension on its second day without comment.
Fantasia Holdings, a medium-sized developer who in recent weeks has assured investors that they “have no problem with cash”, said the stock exchange “did not pay” on Monday the $ 206m settlement that had been settled for the day, which led to errors.
Constability increases the fear that a problems in Evergrande will expand and include Chinese manufacturers, which are a major part of Asia’s largest retail market. The real estate sector is facing challenges from Beijing to cut costs after a number of years of growth that have contributed to the country’s rapid economic growth.
Evergrande missed interest on maritime trade on September 23, which led to a 30-day grace period, and did not make any announcement on the matter.
Fantasia re-launched its markets in the markets before opening Tuesday in Hong Kong, in conjunction with Evergrande, which shut down its company-owned business on Monday morning.
Employees at Evergrande said in a Monday exchange that it had suspended sales in advance of the “provided opportunity” for its shares. Hopson Development, another Hong Kong-based manufacturer, broke its stance on Monday, prompting Chinese journalists to speculate it could play a major role in Evergrande’s sponsorship business, which was announced last year.
On Tuesday morning Evergrande had not yet announced the details of the deal, which led to a halt to sales as the company rushed to meet debt of more than $ 300bn.
“There is nothing he can do. . . the worst has not happened, “said Dickie Wong, chief research officer at Kingston Securities in Hong Kong.
In addition to Fantasia’s stability and payment to Evergrande, China Fortune Land Development, which operates in commercial parks in the Hebei region, unchanged on a sea loan in February.
Fantasia last week was dropped from the CCC by the S&P, which said it was “a deadly risk on repayment” compared to a debt due Monday.
The Fitch agency claims Fantasia had $ 1.9bn to pay off sea bills due by the end of next year and Rmb6.4bn ($ 1bn) to pay off sea bills at the same time.
The company entered the market at the end of August to buy $ 6.5m of revenue that grew on Monday.
But its bonds have recently fallen on a downward spiral, with the $ 250m dollar-denominated bond growing in December falling to $ 0.38 per dollar this week.
Shares in Huarong, China’s worst supervisor, were suspended for several months this year after the company delayed its reports before revealing what had been lost in August. The delay led to a crisis over Beijing’s intervention to help troubled companies.
“Actually they [Evergrande] should not be announced in detail. Advertising can be as simple as, ‘We’re making a deal,’ standing all the time, “said Wong.” There’s no time. “
Evergrande, whose shares had fallen more than 80% this year before the stock market stopped, tried for months to raise funds from real estate to help pay more than $ 300bn in total payments.
The Hang Seng stock index following Hong Kong’s biggest advertisers fell nearly 2.2% on Monday but Tuesday was flat.