China’s credit market has recorded its steepest selloff in two years as financial distress at Zhuhai Huafa Group challenges the view that government ties can shield state-owned companies from financial trouble.
The conglomerate, wholly owned by local governments in Guangdong province, missed payments on two trust products and asked to extend some bank loans, according to people familiar with the matter. The loan-extension requests were reported last Monday.
Sources: Bloomberg Markets.