Evergrande would have paid back interest on two bonds

China Evergrande Group reportedly made at least two interest payments on past due bonds, part of its biggest test since the debt crisis began.

The company made at least two of three past-due interest payments on its US dollar-denominated bonds, according to people with knowledge of the matter. Its dollar values ​​remain in trouble as creditors prepare for an eventual debt restructuring that could be among the largest in China.

Investors had been waiting to see if the embattled developer would make coupon payments totaling $ 148.1 million for three dollar bonds before the end of the 30-day grace periods on Wednesday. Evergrande missed initial interest deadlines last month, according to data compiled by Bloomberg.

The affected bonds include a 9.5% bond due 2022, 10% bonds due 2023, and its 10.5% bond due 2024.

The real estate giant was on the brink of default in October but managed to pay other coupons before the end of his grace period. But the crisis of Asia’s largest speculative-grade bond issuer is far from over as it grapples with more than $ 300 billion in liabilities.

Other developers are also struggling amid a crackdown on speculation and leverage after years of debt-driven expansion. The contagion has even spread to other areas of the credit market.

On Monday, two holders of other dollar bonds sold by a unit of China Evergrande said they had not received coupon payments that were officially due on Saturday. Both coupons also have a 30-day grace period before any late payment is considered a default.

A representative for Evergrande did not immediately respond to a request for comment sent outside of normal business hours.

The authorities have tried to limit the consequences of the broader degree of stress in the real estate market, with the injection of liquidity into the financial system by the central bank.

Bonds and shares of Chinese promoters rallied on Wednesday after Securities Times said that the authorities are likely to ease controls for the country’s real estate companies to issue bonds in local currency, part of efforts to prevent further deterioration of their financing.

But concerns remain. A series of defaults and downgrades in the real estate industry in recent weeks pushed Chinese issuers’ dollar junk bond yields to the highest in at least a decade, above 24%.