Evergrande Among 12 Developers Told to Report Financing Monthly
Evergrande Among 12 Developers Told to Report Financing Monthly
(Bloomberg) -- China’s regulators have stepped up efforts to rein in Chinese developers, requiring some of the country’s largest real estate companies to disclose details on financing on a monthly basis.
The housing watchdog and central bank have asked 12 developers including China Evergrande Group, Sunac China Holdings Ltd. and China Vanke Co. to report their financing, total debts and business data on the 15th of every month, according to a person familiar with the matter, who requested not to be identified.
Worried by systemic risks that Evergrande, the world’s most indebted developer, may have posed to China’s financial sector, regulators are closely monitoring the country’s real estate firms. Evergrande has come under intense investor scrutiny in recent weeks after fears of a cash crunch triggered a sell-off in the company’s bonds and shares. While few expect the developer to default any time soon, it’s facing pressure to pare back a $120 billion debt pile and increase cash reserves.
Chinese property developers could accelerate their disposals of non-core assets and spinoffs to comply with the new rules, including China’s three red lines diktat. Reuters first reported the new requirements for the 12 developers.
“This should ease investors’ concerns about the possibility of aggressive growth in off-balance-sheet debt in the future,” Wilson Ho, a Hong Kong-based analyst at Barclays wrote in a report.
A representative for Vanke declined to comment, while Evergrande, Sunac didn’t immediately respond to queries. The central bank and housing regulator didn’t respond to calls to their office hotlines.
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With assistance from Bloomberg