China Has More Distressed Corporate Debt Than All Other EMs

The nation has 15 bonds with OAS above 1,000 basis points
Yield on corporate debt in emerging markets is near 2016 high

Christopher Yip of Standard & Poor’s talks about China’s real estate market and the cash-squeezed developers. (Source: Bloomberg)

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By Selcuk Gokoluk

November 7, 2018 at 8:01 PM UTC

Updated on

November 8, 2018 at 10:02 AM UTC

This article is for subscribers only.

In the span of just 11 months, China went from having no distressed dollar-denominated corporate bonds to having more than any other emerging market.

The world’s second-biggest economy has 15 bonds whose option-adjusted spreads over U.S. Treasuries were above 1,000 basis points as of Nov. 6, according to a Bloomberg Barclays index. That’s more than all the other nations on the gauge, combined.