China Company Bond Delinquencies Quadrupled Last Quarter

(Bloomberg) -- Chinese companies have missed payments on 26.2 billion yuan ($3.9 billion) of local bonds in the first quarter, almost quadruple the same period in 2018. It was also the third highest quarter for bond delinquencies in China’s history, according to data compiled by Bloomberg. “Defaults surged mainly because companies’ profit-making capability has not improved substantially,” said Yang Yewei, chief fixed-income analyst from Southwest Securities Co. “As companies are still struggling to secure more longer-term bank loans, defaults in the second quarter will likely continue at the current pace.”

--With assistance from Ailing Tan.

To contact Bloomberg News staff for this story: Molly Dai in Singapore at bdai13@bloomberg.net;Wenjin Lv in Shanghai at wlv8@bloomberg.net;Tongjian Dong in Shanghai at tdong28@bloomberg.net;Qingqi She in Shanghai at qshe@bloomberg.net

To contact the editors responsible for this story: Neha D'silva at ndsilva1@bloomberg.net, Lianting Tu, Matt Turner

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With assistance from Bloomberg