(Bloomberg) -- China Aoyuan Group Limited said it has decided not to make payments on four notes dated through 2024 and is exploring asset sales to pay down debt, becoming the latest Chinese developer to be impacted by the industry’s liquidity crisis.

High yield notes jumped as much as 10 cents on the dollar and Chinese property stocks surged on Wednesday after reports that regulators may ease curbs on developers’ access to funds from presold homes. 

Bonds of Country Garden Holdings Co. and Sunac China Holdings Ltd. saw record gains, only days after tumbling to unprecedented lows. In the stock market, short-seller favorite Agile Group Holdings Ltd. rose 13%, the most since 2015.

Key Developments:

  • Greentown China Proposes Issue of USD Credit Enhanced Bonds
  • China Aoyuan: Won’t Make Some Payments, Exploring Asset Sales
  • Chinese Property Bonds Soar as Investors Bet Worst Is Over (1)
  • China Considers Easing Developer Cash Crunch With Presale Funds
  • China’s Spreading Property Debt Crisis Pressures Xi to Ease
  • Why Hidden Debt Is a Big Problem for China Developers: QuickTake

 

Chinese Property Bonds Soar as Investors Bet Worst Is Over (7:35 a.m. HK)

A record-breaking rally in Chinese property bonds highlighted the huge sums of money primed to flow into the distressed securities should Beijing dial back its industry crackdown.

High yield notes jumped as much as 10 cents on the dollar and Chinese property stocks surged on Wednesday after reports that regulators may ease curbs on developers’ access to funds from presold homes. Bonds of Country Garden Holdings Co. and Sunac China Holdings Ltd. saw record gains, only days after tumbling to unprecedented lows. In the stock market, short-seller favorite Agile Group Holdings Ltd. rose 13%, the most since 2015.

China Aoyuan Won’t Make Some Payments, Explores Asset Sales (7:20 a.m. HK)

China Aoyuan Group Limited said in a Hong Kong filing that it has decided not to make payments on four notes dated through 2024 and is actively exploring asset sales to pay down debt. 

“The continued market downturn and the dampening of purchasers’ confidence have caused difficulties for the Group to realise its inventories and dispose of its assets on reasonable terms,” the company said.

China Considers Easing Developer Cash Crunch With Presale Funds (6:43 p.m. HK)

Chinese regulators are considering lifting some restrictions on developers’ access to cash from presold properties tied up in escrow accounts, people with knowledge of the matter said.

Regulators including the housing ministry and the banking watchdog are still discussing details and may convey the instructions through window guidance to local governments later this month, said the people, asking not to be identified because the talks are private. Authorities are contemplating a package of policies to prevent a deepening of the real estate crisis, one of the people said.

Sunac Sells Stakes in Several Property Projects to SOEs: Cailian (6:39 p.m. HK)

Sunac sold a 40% stake in the second phase of a resort project in southwestern China’s Kunming city to Huafa Group for 1.4 billion yuan, Chinese media outlet Cailian reported, citing sources. Sunac also recently sold stakes in two projects in Wuhan city respectively to Beijing Capital and Wuhan Urban Construction Group, according to the report. Sunac didn’t immediately comment when reached by Bloomberg.

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