29/09/2021 14:19 3
29-09-2021 14:19:54 07:00
Evergrande’s fate is still hanging, China continues to pump money into the system
From September 17 to now, the PBOC has netted a total of 750 billion yuan, equivalent to more than 116 billion USD, through open market operations…
Artwork – Photo: Getty/CNBC.
Central Bank The country (PBOC) injected liquidity into the financial system for the ninth day in a row, marking the longest money injection since December last year, amid the lack of a concrete exit to the debt crisis in the public sector. real estate giant Evergrande.
According to Bloomberg news, PBOC pumped 100 billion yuan, equivalent to 15.5 billion USD, cash enters the banking system through reverse repo agreements with a term of 14 days.
In addition to meeting demand Liquidity demand increased sharply at the end of the quarter and before the 1-week National Day holiday in early October, the PBOC’s continuous liquidity injection is also said to calm the market’s concerns about the Evergrande crisis.
From September 17 to now, the PBOC has injected a total of 750 billion yuan, equivalent to more than 116 billion , through open market operations. As a result, interbank lending rates fell 0.41 percentage points to 1.5%, the lowest level since May.
9 days continuously pumped cash into the system of the Central Bank of China (PBOC). Unit: billion yuan – Source: Bloomberg.
September 29 is the deadline Evergrande has to pay a bond interest of 47.5 million to foreign investors. However, the company has not made any statement about this maturity. In addition, Evergrande also continued to keep quiet about another bond interest due last Thursday. After the 30-day grace period, if Evergrande fails to pay interest on either interest, the company will be considered technically insolvent.
In a Listing information on the stock market on September 29, Evergrande said that the company plans to sell shares worth 1.5 billion USD in Shengjing Bank to a company. Chinese Government Asset Management Company.
Shengjing Bank is one of the biggest lenders to Evergrande. This bank made a request that all proceeds from the sale of this share be used to settle Evergrande’s financial obligations to Shengjing Bank.
The above move shows that Evergrande will have to put domestic creditors and investors above foreign bondholders in the process of settling debt obligations totaling up to 305 billion USD of the company.
Besides the money injection, the PBOC on September 28 issued a statement pledging to protect people consumption in the real estate market, but not Evergrande.
However, these moves of the PBOC have helped strengthen investor confidence. private. Evergrande shares sometimes increased up to 15% in the session on September 29 in Hong Kong.
Diep Vu
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