Evergrande-China's largest property group by sales Photograph:( Reuters )
Evergrande crisis is sending jitters through China's financial system. The firm had debts strtching to billions of dollars, equal to 2 per cent of China's GDP. Hong Kong Stock Exchange has not given any reason why trading in Evergrande shares has been suspended but the action has come amid reports that the company failed to pay bond interest to bondholders second time in a row
In what can be another blow to reputation of China's debt-laden Evergrande, Hong Kong stock exchange said that it had suspended trading in its shares. The action has come days after some bondholders said the property developed had missed the second payment of interest on bonds. The Evergrande crisis is at the center of jitters in China's financial system.
Hong Kong stock exchange did not say why stock trading had been halted. It was unclear who had initiated the suspension.
Evergrande's liabilities make it the most indebted property firm in the world. The debts stretch into hundreds of billions of dollars. This makes it equal to 2 per cent of Chinese GDP. Initial worries have eased somewhat after China's central bank vowed to protect homebuyers' interests.
Shares in Evergrande have plunged 80% so far this year, while its property services unit has dropped 43% as the group scrambles to raise funds to pay its many lenders and suppliers.