Huarong Bonds Slump as Fitch Cut Overshadows April Repayments
- Company rating cut to BBB from A and could be reduced further
- Huarong’s perpetual bond ratings lowered to junk territory
The China Huarong Asset Management Co. headquarters in Beijing on April 21.
Photographer: Yan Cong/BloombergThis article is for subscribers only.
China Huarong Asset Management Co. bonds dropped after a three-level downgrade by Fitch Ratings overshadowed the embattled distressed-debt manager’s repayment of local and offshore notes due on Tuesday.
Fitch cut Huarong to BBB from A, becoming the first of the big three international ratings firms to downgrade the state-owned company after it missed a deadline to release 2020 results by March 31. The firm’s financial leasing unit rating was also reduced three notches, to BBB-. Speculation that Huarong may restructure its debt has jolted credit markets across Asia, with Chinese officials and Huarong itself offering little guidance about the company’s fate.