Qinghai Provincial Investment Group Co. became the latest state-backed borrower to miss a repayment on one of its dollar bonds, adding to concerns that authorities are less and less willing to intervene to help troubled firms avoid default, Bloomberg reports.
The aluminium producer has been tussling with a debt burden for over a year now. Many viewed the company as a good indicator of state support, given its close ties to local government.
The coupon in question is now considered a default, according to Bloomberg.
Late last year QPIG was struck from S&P’s CreditWatch listing due to the fact that it would “continue to receive ongoing government support and be able to meet its short-term financial obligations over the next 12 months, despite its weak liquidity.” QPIG now has a B+ rating, four ranks below investment grade.