Moody's Downgrades Biguiyuan to 'Ca'... "Default Imminent with No Recovery Possibility"

International credit rating agency Moody's announced on the 31st (local time) that it will downgrade the credit rating of Country Garden, China's largest private real estate developer facing a default crisis, from the previous 'Caa1' to 'Ca'.

[Image source=Yonhap News]

Earlier this month, Country Garden was downgraded from 'B1' to 'Caa1' after failing to make interest payments on corporate bonds, and less than a month later, Moody's has taken further downgrade action. With this rating adjustment, Country Garden's bonds have fallen from a 'very high credit risk (Caa1)' to an 'imminent default with little prospect of recovery (Ca)'.

Moody's explained, "The downgrade, including a negative outlook, reflects Country Garden's tight liquidity, increased risk of default, and creditors' weak recovery expectations." It also pointed out that Country Garden's high debt leverage and large-scale financing by its subsidiaries are problematic.

This content was produced with the assistance of AI translation services.