China Huarong’s dollar bonds soared up to 10% after its detailed announcement yesterday which indicated a state-led bailout and no plans of a debt restructuring, putting to end uncertainty over the bad-debt asset manager. Through the announcement, Huarong issued a warning of a net loss of ~$15.9bn for 2020 on account of provisions for several credit impairment losses. On the positive front, Huarong said that arrangements and preparations had been made to redeem bonds in the future with no debt restructuring plans. Huarong said that it had signed investment agreements with China CITIC Group, China Insurance Investment Co., China Life AMC, China Cinda AMC and Sino-Ocean Capital Holdings Co. who will subscribe to newly issues shares by Huarong adding that a potential strategic investment is in progress.
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