Wednesday, December 8

Kaisa, another reeling Chinese real estate giant

The decision joins the list of worrisome news about China’s indebted real estate sector, especially around the giant Evergrande that has been on the brink of bankruptcy for weeks and also temporarily suspended its listing in Hong Kong in October.

In the case of Kaisa, Chinese media had recently reported that some wealth management products linked to this company were not reimbursed on time and that its CEO had recognized “unprecedented pressure on its liquidity.”

In its brief communication to the Hong Kong stock exchange, the firm did not specify the reasons for the suspension.

Last week, debt rating agencies Fitch and S&P downgraded the company’s rating.

China’s real estate sector, responsible for a quarter of the country’s wealth, is reeling after years of heavy borrowing that authorities now want to bring under control.

The measures taken from Beijing to appease this leverage have aggravated the problems of firms such as Evergrande, one of the main promoters of the country with an accumulated debt of more than 300,000 million dollars.