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China Tells Banks Evergrande Won’t Pay Interest Next Week

  • Ministry of housing met with lenders this week to flag delay
  • Evergrande is discussing loan extensions, rollovers with banks
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WATCH: Authorities are warning major lenders that Evergrande won’t be able to make interest repayments next week. Rebecca Choong Wilkins reports.(Source: Bloomberg)
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Chinese authorities have told major lenders to China Evergrande Group not to expect interest payments due next week on bank loans, according to people familiar with the matter, taking the cash-strapped developer a step closer to one of the nation’s biggest debt restructurings. 

The Ministry of Housing and Urban-Rural Development told banks in a meeting this week that Evergrande won’t be able to pay its debt obligations due on Sept. 20, said the people, asking not to be identified discussing a private matter. Evergrande is still discussing the possibility of getting extensions and rolling over some loans. The developer will also miss a principal payment on at least one loan next week, one of the people said.