China’s housing ministry has notified the country’s major banks that the debt-ridden property developer, China Evergrande Group, will be unable to pay loan interest due on September 20, reports Reuters. The announcement highlights the widening impact of the company’s liquidity crisis.
Sources familiar with the matter told Reuters that The Ministry of Housing and Urban-Rural Development held a meeting with the banks this week, adding that Evergrande is still discussing with banks the possibility of extending payments and rolling over some loans.
The troubles ailing the nation’s second-largest property developer have already sparked anger among investors and homebuyers and raised risks for China’s vast financial system. The company is scrambling to raise funds to pay its many lenders and suppliers, as it teeters between a messy meltdown with far-reaching impacts, a managed collapse or the prospect of a bailout by Beijing.