The world’s most indebted developer may be facing its next big debt test from yesterday, underscoring the broader risks of opaque obligations in credit markets already on edge. Sources have said that a dollar note maturing Oct 3 issued at an initial amount of US$260mil (RM1bil) by an entity called Jumbo Fortune Enterprises is guaranteed by Evergrande. Any failure to pay Jumbo Fortune’s note may also pose a risk of cross-default for Evergrande’s other bonds, according to Bloomberg Intelligence analyst Daniel Fan. Standard Chartered’s head of China macro strategy Becky Liu expects Evergrande has more structured products such as guaranteed bonds, similar to the Jumbo Fortune note, with offshore dollar bonds making up just 6% of the firm’s total reported liabilities. The law firm White & Case is advising various investors with regard to Jumbo Fortune, a spokesperson for the firm said.

Source: The Star October 03, 2021 23:03 UTC