Fitch Cuts China Aoyuan to Restricted Default: Evergrande Update
Unfinished apartment buildings at the construction site of a China Evergrande Group development in Beijing.
Photographer: Andrea Verdelli/BloombergFitch Ratings has downgraded China Aoyuan Group Ltd. to ‘Restricted Default’, while China Evergrande Group’s dollar bonds climbed the most in four months after signs of progress in what will likely be one of the nation’s largest restructurings.
The ratings company cited Aoyuan’s announcement earlier this week that it won’t make payments on a set of dollar bonds. An Aoyuan dollar bond originally due on Thursday, one of the four the developer said it will skip payments on, was indicated 3.6 cents on the dollar lower at 13.9 cents Friday, according to Bloomberg-compiled prices. The company’s shares closed up 0.6% in Hong Kong, amid broader gains in the sector on hopes for further government support for developers and borrowers.