China’s fast-growing dollar-bond market is facing a fresh test as investors that counted on a type of credit-protection pledge seldom seen elsewhere find out just what those promises actually mean, Bloomberg News reported. So-called keepwell provisions, disproportionately seen in the offshore Chinese debt market the past several years, are a sort of gentleman’s agreement - a commitment to maintain an issuer’s solvency which stops short of a payment guarantee from the parent company. Now, two issuers of debt with keepwell provisions, China Energy Reserve & Chemicals Group Co.

China’s banks, scrambling to adjust to the government’s deleveraging campaign, are likely to add to pressures on the corporate bond market as they shed more of their massive note holdings and de-risk their balance sheets, Bloomberg News reported. Further payment problems are likely in a market that has already seen at least 14 corporate bond defaults this year, according to Logan Wright, Hong Kong-based director at research firm Rhodium Group LLC.

When top Chinese business leaders and officials face charges, they usually have one option: Go quietly. The tycoon at the center of one of China’s biggest cases of financial fraud seems to be taking a different path, the International New York Times reported. A lawyer representing Wu Xiaohui, a businessman who rose to prominence in part through his company’s purchase of the Waldorf Astoria hotel in New York, said Wednesday in a social media post that Mr. Wu would appeal a lengthy prison sentence for bilking investors.

Czech financial firm J&T said on Friday it had struck a deal with Chinese state conglomerate CITIC Group to settle debts owed by troubled Chinese company CEFC, ending a dispute, Reuters reported. Privately-held CEFC has spearheaded a Chinese acquisition drive in the Czech Republic, championed by Czech President Milos Zeman, which includes a range of assets including engineering, brewing and real estate as well as a soccer club and an airline.

China Energy Reserve & Chemicals Group Co. said it hasn’t paid a $350 million bond that matured earlier this month, in the latest example of China’s deleveraging campaign choking off financing for some companies, Bloomberg News reported. The oil and gas producer, which has $1.8 billion of offshore notes outstanding, cited “tightening in credit conditions” for the default.

Chinese regulators are making progress in their attempts to tame the country’s $10 trillion shadow banking sector, but after a one-year squeeze on the riskiest areas of the industry, there’s still a lengthy battle ahead, Bloomberg News reported. "We’ve had a good beginning to a long journey," said Larry Hu, a Hong Kong-based economist at Macquarie Securities Ltd. "Some components of shadow banking are shrinking and interbank leverage has started to drop.

S&P Global Inc., the financial-information giant, plans to build a stand-alone ratings business in China, bringing it a step closer to expanding its presence in one of the world’s biggest bond markets, The Wall Street Journal reported. The company has notified the Chinese government of a plan to launch an independent credit-ratings firm in the country, an S&P spokesman said Wednesday. A trade deal last year opened up China to U.S. ratings firms. S&P is speaking with regulators on the entrance. Moody’s Corp.

As corporate defaults pile up in China’s onshore bond market, a unit of a once-promising energy conglomerate with $4.8 billion of debt and a checkered past said it won’t be able to meet its payment obligation Monday, Bloomberg News reported. CEFC Shanghai International Group Ltd., a unit of the privately-held CEFC China Energy Co., failed to repay 2 billion yuan ($313 million) of bonds but said it will seek to pay back the notes in six months, according to a statement on the Shanghai Clearing House website.

Kingtec Steel Corporation, based in China’s far northwestern region of Xinjiang, is preparing to apply for bankruptcy as a result of spiraling debt, the company said in a statement on Friday. Kingtec said it would be unable to pay all of its debts, including a 550 million yuan ($86.26 million) bond issued in 2013, Reuters reported. It blamed its problems on the poor steel business environment in Xinjiang as well as a “gradual deterioration” in its own operating conditions. It has ceased production.

Creditor J&T Private Investments (JTPI) said on Thursday it had taken over shareholder rights and installed crisis management at CEFC Europe, the Czech-based part of troubled Chinese conglomerate CEFC China Energy, Reuters reported. The move is a sign of fresh woes for CEFC Europe which bought Czech assets from real estate to breweries, an engineering firm, an airline and a football club, under an investment drive promoted by Czech President Milos Zeman. CEFC Europe protested against the move, saying it had the money ready to cover the debt.