The company logo of Chinese developer Country Garden is pictured at the Shanghai Country Garden Center in Shanghai, China August 9, 2023.
REUTERS/Aly Song/File PhotoAug 14 (Reuters) - Turmoil at China's largest private developer Country Garden could set off a "vicious cycle" of financing stress on the country's real estate investment trusts (REITs), brokerage J.P. Morgan warned on Monday.
These fresh worries come as Country Garden sought to delay payment on a private onshore bond for the first time and suspended trading in 11 onshore bonds.
"The default events may lead to a chain reaction on developer financing, adding stress to POE (privately owned enterprise) developers and their creditors."
Rising trust defaults would drag economic growth by 0.3-0.4 percentage points directly, J.P.Morgan warned.
Persons:
Aly, Morgan, Katherine Lei, POE, J.P.Morgan, Nomura, Roshan Abraham, Susan Mathew, Danilo Masoni, Varun, Arun Koyyur
Organizations:
Shanghai Country Garden, REUTERS, China's, Zhongzhi Enterprise Group, Zhongrong, China Evergrande, Thomson
Locations:
Shanghai, China, HK, Beijing, Bengaluru, Milan