Rating agency Standard and Poors cut Sinic Holdings to CCC

  • says the firm has not communicated a clear repayment plan
  • timing of any remittance is uncertain

Placed on CreditWatch Negative.

I posted S&P thoughts on Evergrande earlier:

A little more on this now:

  • Does not expect the Chinese govt to provide any direct support to Evergrande group
  • "we believe Beijing would only be compelled to step in if there is a far-reaching contagion causing multiple major developers to fail and posing systemic risks to the economy
  • "we anticipate Evergrande's direct negative effects on other major players' projects would be manageable, even in a default scenario"
  • "we believe the Chinese banking sector can digest an Evergrande default with no significant disruption, although we will be mindful of potential knock-on effects"

The Hang Seng index in HK has stabilised somewhat after a shaky start to the session. Mainland China markets are on holiday again today after the holiday Monday. They return Wednesday.