China Averts Second Corporate Default as Huatong Pays Bonds

China avoided a second default in its onshore corporate bond market, easing concern that financial-market instability could spread as debt rises and growth slows in the world’s second-largest economy.

Huatong Road & Bridge Group Co. paid all principal and interest on 400 million yuan ($65 million) of notes today, four people familiar with the matter said, asking not to be identified because they weren’t authorized to speak publicly. The builder based in the northern province of Shanxi said last week it might fail to make payment.