Introduction

Contents

1. BI research: China property bond price plunge implies investor capitulation

2: Credit risk analysis: China's default rate may rise to new record after breaking 6%

3. China's secondary bond market: Offshore trading volume down 32%

4. China primary bond market: Onshore issuance down 20%

5. Appendix: Key functions and BI reports

6. Additional charts: Distressed securities and subscription trends

*Disclaimer

In our latest edition of the China Market Insights, we note that the country's median property bond price has dropped to 16 cents from 40 cents in March and more selling could ensue. Our analysis shows China's offshore dollar-bond default rate may rise further to 6.5% from the current 6.2% while offshore trading volume was down 32% in July compared with the previous month. Guangzhou R&F was the largest kungfu bonds issuer in July as it managed to extend three kungfu bonds by 3-5 years to 2025-28 with a coupon at 7.5%. Refer to our appendix for our analyses on Macau gaming operator bonds, credit of big Chinese internet firms amid regulation pressure and other relevant BI reports on China.

John Lee
Regional Market Analyst
Bloomberg Intelligence

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