China's Country Garden Defaults on Dollar Bond, Declared 'Event of Default'
Country Garden, the largest builder in the Chinese property market, has failed to pay $15.4 million in interest on its dollar bonds, marking its first default. The company had previously warned creditors that it would not be able to repay a separate loan due to sales pressure. With its shares losing over two-thirds of their value this year, Country Garden is now likely facing one of China's biggest-ever restructurings. This default adds to the ongoing distress in the Chinese property market, which accounts for about 20% of the country's GDP. The Credit Derivatives Determinations Committees will meet to discuss if a failure-to-pay credit event occurred, potentially triggering credit default swap contracts.
