S&P slices, pulls Country Garden

S&P said it downgraded Country Garden Holdings Co. Ltd.’s issuer rating to B+ from BB and then withdrew the rating at the company’s request. The outlook was negative.

“We lowered the ratings to reflect narrowing funding channels for Country Garden. The company's funding channels in both onshore and offshore bond markets have been closed off amid fading market confidence in private Chinese developers. In our view, it will need to rely heavily on internal resources to settle its upcoming bond maturities and bank-syndicated loans. This could undermine Country Garden's existing cash buffer. We also believe interest coverage will deteriorate due to a lack of access to low-cost funding from offshore markets,” S&P said in a press release.

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