China Evergrande shares hit 11-year low after firm says no guarantee it can meet repayments

The China Evergrande Centre constructing signal is seen in Hong Kong, China, September 23, 2021. REUTERS/Tyrone Siu

HONG KONG, Dec 6 (Reuters) – Shares of China Evergrande Group (3333.HK) tumbled 12% to an 11-year low on Monday after the agency stated there was no assure it might have sufficient funds to fulfill debt repayments, prompting Chinese language authorities to summon its chairman.

The shares fell as a 30-day grace interval on a coupon cost of $82.5 million due on Nov. 6 involves an finish on Monday.

Evergrande, as soon as China’s top-selling developer, is grappling with greater than $300 billion in liabilities. A collapse might ship shockwaves by means of the nation’s property sector and past.

In a submitting late on Friday, Evergrande, the world’s most indebted developer, additionally stated it had obtained a requirement from collectors to pay about $260 million.

That prompted the federal government of Guangdong province, the place the corporate relies, to summon Evergrande Chairman Hui Ka Yan, and it later stated in a press release it might ship a working group to the developer at Evergrande’s request to supervise threat administration, strengthen inner controls and preserve regular operations.

In a sequence of apparently coordinated statements late within the night, China’s central financial institution, banking and insurance coverage regulator and its securities regulator sought to reassure the market that any dangers to the broader property sector could possibly be contained.

Quick-term dangers brought on by a single actual property agency won’t undermine market fundraising within the medium and long run, the Individuals’s Financial institution of China stated, including that housing gross sales, land purchases and financing “have already returned to regular in China”.

Evergraned’s inventory fell greater than 12% to HK$1.98, its lowest since Could 2010.

Reporting by Clare Jim; Modifying by Anne Marie Roantree and Christopher Cushing

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