Key facts
- Zhuhai Huafa Group missed payments on two trust products that had come due, people familiar with the matter said.
- Huafa repaid some investors on one of the overdue trust products, a person familiar with the matter said.
- The company has asked some Chinese banks to extend loans and reduce interest rates, according to the report.
China's credit market has sold off, according to the report, with a large conglomerate's financial distress testing the assumption that government ties shield state-owned firms from financial peril. The report does not date the selloff or the broader assessment.
Zhuhai Huafa Group Co., a local-government-owned conglomerate with $62 billion of debt, missed payments on two trust products that had come due, people familiar with the matter said. The missed payments were reported by Bloomberg on Monday.
After a selloff in the company's offshore bonds during the week, Huafa repaid some investors on one of the overdue trust products, a person familiar with the matter said. The company has also been asking some Chinese banks to extend loans and reduce interest rates, according to the same reporting.