Chinese property developer Country Garden made payments on two dollar bonds within their grace periods on Tuesday, ending a month-long saga that had become the focal point of global investors’ concerns about China’s struggling property sector, reports the Financial Times. The company’s Hong Kong-listed stock pulled back from a drop of almost 5% to 3% in late-morning trading, following local media reports that it had made the late coupon payments totalling $22.5 million on two $500 million international bonds.
A person close to the company and a bondholder told the Financial Times that Country Garden had made the payments, for which it had missed an initial deadline in early August. Country Garden declined to comment.
The payments mean the cash-strapped developer has narrowly avoided a technical default, but traders said this would not change the narrative of widespread and worsening financial strain in China’s vast and economically important real estate sector.