China Builder Bonds Diverge as Offshore Creditors Lose Most
- Some developers’ local notes have held up amid offshore slide
- Repayment efforts focus on those more likely to help long-term
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A record rout in dollar bonds from China’s distressed developers is leaving international investors in the cold, even as local creditors find solace.
Examples of the divergence abound. Dollar notes from builders including Yuzhou Group Holdings Co. and Shimao Group Holdings Ltd. have plunged this year, even as yuan bonds have fallen less or gained. Onshore holders have received coupon payments or sweetened offers on extension proposals while offshore payments go missed. A case also emerged recently that flagged risks whether money owed in a restructuring would be able to leave the country.