HONG KONG -- China Evergrande Group has gone from narrowly avoiding a cash crunch in September to being able to pay back a $2 billion bond early -- but that does not mean all is once again well at Asia's largest private sector debtor.
Last year Evergrande rang alarm bells far beyond China when a letter purportedly from the property-focused company warned of a looming liquidity crisis without help from local government. Such a scenario -- for a company that at the time owed $130 billion to banks, shadow lenders and holders of domestic and offshore bonds -- risked being devastating for China's $50 trillion financial system, sending debt problems cascading from the highly leveraged property sector into potential cross-defaults on loans from banks and trusts.
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