China Coal Miner Fails to Make Bond Payment Amid Slowing EconomyBloomberg News
Shanghai Clearing House hasn't got payment from Shanxi Huayu
Shanxi Huayu must repay 637.7 million yuan debt on Wednesday
A Chinese coal miner failed to make a bond payment Wednesday, highlighting rising credit risks in the nation as economic growth slows.
The Shanghai Clearing House hadn’t received funds from Chinacoal Group Shanxi Huayu Energy Co. to pay holders of its 600 million yuan ($92.5 million) 6.3 percent notes, according to a statement on the clearing house’s website Wednesday. The coal miner, which is based in the northern province of Shanxi, sold the securities last year.
Chinese firms are struggling with surging debt burdens amid the country’s worst economic slowdown in a quarter-century. At least 13 companies have defaulted on bonds in the past two years even as the central bank loosened monetary policy. Dongbei Special Steel Group Co., whose chairman was found dead by hanging last month, defaulted on securities a second time in two weeks on Tuesday.
Two calls to Shanxi Huayu Energy went unanswered. The firm said Tuesday it may miss the 637.7 million yuan payment in principal and interest on the notes due on Wednesday.
— With assistance by Judy Chen