Fitch downgrades Chinese property giant Vanke
by AFP Staff Writers
Shanghai (AFP) Mar 22, 2024

Fitch downgraded the credit rating of major Chinese property developer Vanke on Friday, the second agency to do so in ten days as the country's property sector grapples with unprecedented challenges.

Some Chinese developers are on the verge of bankruptcy and lower property prices have deterred consumers from making investments.

Vanke -- long considered to be financially stable -- was downgraded by Fitch on Friday from "BBB" to "BB+", citing the group's "weakened sales performance" and challenges accessing funding.

"China Vanke's ratings are constrained by its liability profile and funding access amid sizable and rising capital-market debt maturities in 2024 and 2025", the US credit rating agency said.

"Without effective market access, the company's liquidity buffer will likely reduce."

Vanke was the second-largest developer in China last year in terms of sales, according to specialist firm CRIC.

It is part-owned by the city government of Shenzhen in southern China -- once seen as a guarantee of its solidity.

But setbacks make it the latest Chinese developer to be caught up in a mounting crisis within the real estate sector, following Evergrande and Country Garden.

tjx/oho/mca

China Evergrande Group

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