When a state-owned coal company in central China defaulted on a bond worth $152m this month, the slip-up seemed unlikely to send tremors through the world’s second-largest economy, the Financial Times reported. Prior to the default by Yongcheng Coal and Electricity Holding Group on November 10, only five Chinese state-owned enterprises (SOEs) had failed to pay back bondholders in the first 10 months of 2020, according to Fitch Ratings — consistent with levels in recent years. But within a fortnight, Tsinghua Unigroup, a high-profile state technology group, would also default.

A Chinese court has accepted an application from a creditor of Huachen Automotive Group Holding Co Ltd seeking the restructuring of the parent of BMW AG's joint venture partner Brilliance China Automotive Holdings Ltd, Reuters reported. The Liaoning Shenyang Municipal Intermediate People’s Court accepted the application from GZ Tooling Group Co Ltd, an auto mould supplier, to restructure Huachen after the Liaoning government-owned company failed to pay mould costs and interest worth 10.2 million yuan ($1.55 million), showed a court filing published on Friday.

China’s investigation into the shock bond default by a state-owned coal miner hit shares of its listed underwriters on Friday, while shedding light on the creaking infrastructure of the country’s $4.4 trillion corporate bond market, Reuters reported. Top-rated Yongcheng Coal & Electricity Holding Group defaulted on a 1 billion yuan ($152 million) bond on November 10, stunning investors. Shares of Industrial Bank Co and China Everbright Bank fell in Shanghai on Friday after regulators said the two underwriting banks were suspected of misconduct.

China’s central bank remains on course to taper its emergency support even as a string of defaults by government-linked companies sends tremors through the credit markets. Officials have been preparing investors about the possibility of withdrawing some of that stimulus as the economic recovery picks up pace, Bloomberg News reported. While a surge in market interest rates this week following the defaults appears to have complicated that plan, economists say it won’t push the People’s Bank of China off its policy course.

China widened its probe into last week’s shock bond default by a state-owned coal miner, saying on Thursday that three underwriting banks were suspected of misbehavior, Reuters reported. China’s interbank bond market regulator said in a statement it will launch investigations into Industrial Bank Co , China Everbright Bank and Zhongyuan Bank Co, which helped Yongcheng Coal & Electricity Holding Group issue bonds.

As Beijing reins in its largesse and credit stresses rise in China amid a wave of defaults, investors should wonder where the ructions will appear next, Bloomberg News reported in a commentary. Going by the numbers, local government financing vehicles – with trillions of yuan outstanding – seem primed to come under pressure. Their debt is meant to help raise capital for infrastructure and other public projects. Issuance in the first seven months of the year totaled 2.5 trillion yuan ($381 billion), up 32% over the same period in 2019.

Tsinghua Unigroup, a major government-backed player in China’s technology race, has defaulted on a 1.3-billion-yuan ($197.96 million) bond, three sources said, as several high-profile delinquencies by state firms rattled the country’s bond market, Reuters reported. The default by Tsinghua Unigroup, a wholly-owned division of the prestigious Tsinghua University in Beijing, on Monday immediately triggered a credit rating downgrade that is expected to weaken the company’s financial health.

A new framework to resolve debt crises in developing countries, meant to ensure that Chinese and private creditors share the burden of providing relief, faces a key test after Zambia became the first African nation to default during the coronavirus pandemic, The Wall Street Journal reported. Finance ministers from the Group of 20 major economies said Nov.

German carmaker BMW said on Tuesday there was no indication that its deal to increase its stake in its joint venture with Brilliance China Automotive would be affected by debt issues at Brilliance's parent, Reuters reported. BMW said in 2018 that it would pay 3.6 billion euros ($4.2 billion) in 2022 for a further 25% stake in the venture with Brilliance - its main joint venture in China - adding to its existing 50% holding and giving it control of BMW Brilliance Automotive (BBA).

A series of unwelcome surprises in China’s huge corporate-bond market has knocked investors’ confidence in the local governments that stand behind many issuers, The Wall Street Journal reported. In one high-profile example, Yongcheng Coal & Electricity Holding Group Co. shocked investors last Tuesday by failing to repay a maturing short-term bond worth 1 billion yuan, or the equivalent of $151 million.