China Vanke to Make Offshore Bond Payment, Easing Concerns
By Jiahui Huang
China Vanke said it will pay a dollar bond due Friday, the state-backed property developer's final offshore debt obligation for the year, seeking to calm liquidity concerns amid China's continuing property crisis.
The Shenzhen-based company said late Wednesday that it deposited $612.6 million into unit Vanke Real Estate's bank account to pay the principal and interest on a $600 million 4.2% offshore medium-term note.
The note, issued in March 2019, is the property developer's third offshore bond due this year.
The expected payment means that Vanke, one of China's few major developers yet to default, would have repaid all of its offshore bonds due this year, composed of two dollar bonds worth $1.23 billion and a yuan bond worth CNY1.45 billion ($200.1 million).
The move came after Vanke secured loans from state banks last month, helping the property developer ease its liquidity pressure amid China's continuing property downturn.
Vanke has about $1.8 billion of four offshore bonds due in 2025, 2027 and 2029, according to Wind data. Next is a $423 billion bond issued in 2019 that will mature in May 2025, the data showed.
Morningstar analyst Jeff Zhang said the dollar bond payment was expected, given the company's recent progress in getting more funding support from financial institutions.
Vanke, whose largest shareholder is a state-owned subway operator, is a top property pick among many analysts amid the Chinese government's ramped-up efforts to rescue the property sector, with Beijing recently encouraging local governments to buy up excess apartments and turn them into public housing.
Its Hong Kong-listed shares were recently 2.1% lower on Thursday, bringing the company's losses this year to 23%. Its Shenzhen-listed shares were down 1.1%.
Write to Jiahui Huang at jiahui.huang@wsj.com
(END) Dow Jones Newswires
June 06, 2024 02:46 ET (06:46 GMT)
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