Fitch downgrades Chinese property developer Evergrande and subsidiaries Hengda and Tianji from C - close to default - to RD - limited default.
6 November, Tianji Fails to Pay $ 645 Million Bond Coupons. A month later, 6 December, the company has not paid coupons for another 590 million.
Evergrande is the second largest construction company in China. Evergrande has a total debt of about $ 300 billion. The default of such a company could negatively affect the industry, as banks will cut loans to developers, and house prices will fall. Banks will suffer from a possible series of defaults, who lend to builders.
In the short term, all this could negatively affect the shares of Chinese companies., long-term - on the desire of large foreign investors to invest in the country's economy.