China Default Risks Flare on Scrutiny of Company Accounting
- NDRC move to scrutinize bond issuance more seen crimping sales
- Local financing vehicles could see credit events: Tianfeng
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As China’s President Xi Jinping steps up efforts to rein in excessive borrowing, the nation’s corporate bond market faces rising default risks as weaker firms and local borrowers struggle to roll over obligations.
The latest salvo came last month, when the top economic planning body said it will step up scrutiny of the public works-related assets held by companies seeking to sell bonds. The National Development and Reform Commission, or NDRC, also said it would further regulate bond sales by public-private partnership projects.