Analysis | Why China ‘Bad Bank’ Huarong’s Fall Is Big Bad News

China Huarong failed to release its 2020 financial reports by a March 31 deadline, which prompted a trading halt in its shares and structured products in Hong Kong. Concerns about the firm’s financial health were sent into overdrive after reports emerged, during weeks of near-silence from officialdom, of a potential restructuring or default. Bondholders, panicked about the prospect of taking a haircut on their investments, confused by conflicting news reports and operating in an information vacuum, spurred wild swings in the firm’s offshore and and local bonds.

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