The National Association of Financial Market Institutional Investors (NAFMII), a self-regulatory body under the PBOC, the China Real Estate Association and China Bond Insurance Co. Ltd, a state-owned credit enhancement institution, held a meeting with 21 private property developers about the progress in bond issuance with state guarantee, reported state-run Securities Times.
Developers include Radiance Holdings, Newhope Real Estate, Dexin China, Dahua Group, Agile Group, Yanlord Land Group, etc, were invited to the meeting, per the report.
Earlier this year, Chinese regulators instructed China Bond Insurance to provide full amount, unconditional and irrevocable joint liability guarantees to onshore bond issued by a few private property developers, part of efforts to address the cash crunch faced by the struggling real estate sector.
Developers including Seazen Holdings, Midea Real Esate, Longfor Expand, Country Garden, CIFI Holdings have issued a total of 8.368 billion yuan of such bonds since August.
China Bond Insurance is currently pushing for the issuance of about 20 billion yuan of such bond by ten private developers, according to property developers that were invited to the latest meeting.
According to public information from the NAFMII, several developers including Longfor Group, Midea Real Estate, Seazen Holdings, Country Garden, CIFI Holdings, etc, are proceeding with the second round of bonds with credit enhancement.
Developers including Radiance Group, Newhope Real Esate and Agile Group are in active preparation for such bond issuance, shows the information.
Last week, Pan Gongsheng, deputy governor of the People’s Bank of China, visited the China Bond Insurance and told it to step up support to bond issuance by private developers. Read more …
It’s rare for a deputy PBOC governor to visit China Bond Insurance, which was aimed to send a positive signal, lift market confidence for private developers’ bond and ensure normal construction and delivery of private developers’s projects,” said a person who attended the meeting with Pan last week.
“Next, the authority will increase the support for private developers’ bond issuance, in particular to help developer with relatively healthy fundamentals to ease temporary funding difficulties,” said the person.
According to data from Citic Securities in September, Chinese property developers’ total funding sources have been around 20% lower than a a year earlier.
On one hand, cash collection from property sales and real estate developer loans declined by about 20%, and meanwhile, distressed developers’ bond financing in onshore and offshore market have almost been cut off and even developers with great credit record were unable to raising funds through bonds or had to face surging borrowing costs, it said.
“Even property sales rebound, the recovery of developers’ credit financing will take more time.”
平安证券固收研报分析，托底政策使微观房企出现两种分化，一是出险房企和未出险房企的分化，针对出险房企的高收益债投资难度较大；二是在未出险房企中国企和民企的分化，国企有较大的相对融资优势。