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China debt crunch

China's Huarong repays $600m in bonds, day after ratings downgrade

Asset manager meets maturity, but Fitch move puts company two notches above junk

Concerns over China Huarong Asset Management's financial health have heightened since it missed reporting its preliminary 2020 results by a March 31 deadline.   © Reuters

HONG KONG -- China Huarong Asset Management, the largest distressed debt manager in the country, on Tuesday repaid about $600 million of maturing bonds, a day after it suffered a credit ratings downgrade.

Fitch Ratings late on Monday downgraded Huarong by three notches to "BBB" -- just two notches above junk status -- from "A", on concerns over the strength of its government backing. Fitch said it will continue to review the company for potential further downgrades, which prompted a further sell-off in some of Huarong's offshore bonds.

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