Fitch downgrades China property developer Sinic's IDR to 'C'

Amidst escalating property sector concerns in China, the US-based Fitch Ratings downgraded the ratings for yet another Chinese property developer, Sinic Holdings (Group) Company Limited.

Key takeaways

“Fitch Ratings has downgraded China-based property developer Sinic Holdings (Group) Company Limited's Long-Term Issuer Default Rating (IDR) to 'C' from 'CCC'. Fitch has also downgraded Sinic's senior unsecured rating to 'C' from 'CCC-', with a Recovery Rating of 'RR5', which is unchanged.”

“The downgrade reflects our view that a default-like process has begun, following Sinic's announcement that certain subsidiaries have missed interest payments on onshore financing arrangements, which was followed by enforcement action taken by one of its offshore creditors.”

Earlier on, Bloomberg reported that another Chinese property developer defaulted on its coupon payment. Fantasia Holdings Group Co. didn’t repay a $205.7 million bond that was due Monday, according to a company statement.

Market reaction

The risk sentiment is sour amid growing China concerns, with the S&P 500 futures attempting a tepid recovery while the US dollar clings onto its recovery gains.