China’s painful economic shutdown was expected to have put the world’s second-largest bond market on course for a third straight record year of defaults. But it’s not panning out that way, Bloomberg News reported. The 30.4 billion yuan ($4.3 billion) worth of debt that’s gone sour so far this year in the $4.5 trillion onshore corporate bond market marks a sharp 21% drop from the pace in 2019, according to data compiled by Bloomberg.

The beleaguered HNA Group Co. has pulled off an escape from a domestic bond default after a hastily arranged creditor meeting that caused a stir in China’s investment community, Bloomberg News reported. The heavily indebted Chinese conglomerate said Wednesday it has garnered enough support from bondholders for a proposal to extend by one year the maturity of a 390 million yuan ($55 million) 7.1% note that originally comes due Wednesday, according to a company filing.

China’s $3 trillion trust industry, a key alternative source of funds for weaker companies, risks sending shock waves through the nation’s financial system with defaults among its investment products predicted to double this year under the strains of the coronavirus outbreak, Bloomberg News reported. The once fast-growing pocket of shadow banking in China has 5.4 trillion yuan ($766 billion) in trust offerings coming due this year, high-yield products backed by loans that are sold to banks, institutional investors and wealthy individuals.

Amid all China’s efforts to contain the economic damage of the coronavirus outbreak, a crucial development slipped by almost unnoticed -- the creation of the first national bad-debt asset manager in 20 years, Bloomberg News reported. Galaxy Asset Management Co. won approval in mid-March to convert into ​a financial asset management firm, gaining a much-coveted license to buy bad loans directly from banks nationwide, and the ability to borrow at relatively low rates.

Banks are under increased pressure to raise loan margins in the Greater China region as the coronavirus pandemic weakens lending and a global dollar liquidity squeeze pushes up funding costs, Bloomberg News reported. That’s a key takeaway from a Bloomberg survey of 15 major syndicated loan arrangers operating in the region, including international and Chinese banks. The survey was conducted between March 30 and April 1.

Swissport International AG, the airport ground services firm owned by beleaguered Chinese conglomerate HNA Group Co., hired advisers to review its debt as passenger air traffic grinds to a halt because of coronavirus restrictions, Bloomberg News reported. The company appointed Houlihan Lokey Inc. as financial adviser as it considers a restructuring of its 1.6 billion euros ($1.7 billion) of debt, according to people familiar with the matter who asked not to be identified because the appointment is private.

China Evergrande Group’s pledge to remake itself as a leaner company with a focus on controlled growth has been met with skepticism, with analysts concerned margins will suffer and others saying investors need more clarity, Bloomberg News reported. China’s most indebted developer unveiled a three-year plan on Tuesday titled ‘Growing Sales, Controlled Scale & Reduced Leverage’. The aggressive strategy includes cutting total debt load by 50%, boosting sales and trimming its land bank. Evergrande also Tuesday reported its first fall in annual profit in four years.

China’s industrial output contracted at the sharpest pace in 30 years in the first two months of the year as the fast spreading coronavirus and strict containment measures severely disrupted the world’s second-largest economy, data showed on Monday, Reuters reported. Urban investment and retail sales also fell sharply and for the first time on record, reinforcing views that the epidemic may have cut China’s economic growth in half in the first quarter.

Chinese PV manufacturer Yingli Solar has broken cover after five months of silence to admit it is undergoing a debt restructuring proposal, pv magazine reported. The Baoding-based company issued a statement yesterday on the English-language investors’ section of its website which said its debt restructuring plan had been approved by its creditors and interested “governments” and “the court”. The statement went on to add the business would “cooperate with the court and administrator in accordance with the law to ensure the normal operation of the company”.

The coronavirus epidemic is accelerating a shakeout in China’s property sector as a cash crunch forces distressed developers to throw in the towel, Bloomberg News reported. With lockdowns across the world’s most-populous nation entering their third month, smaller home builders are being pushed to the brink because they can’t get enough money from pre-sales of apartments to cover their costs. In the first two months of this year, around 105 real estate firms issued bankruptcy filing statements, after almost 500 collapses in 2019, data compiled by Bloomberg show.