"But the defaults still took the market by surprise considering that Brilliance is a leading domestic auto group and a state-owned enterprise in Liaoning province. Operations of the parent company and other subsidiaries continue to suffer large losses, which places greater pressure on debt,” a staffer in the investment banking department of a securities firm told reporters. The group’s operations are over-dependent on its BMW Brilliance unit. “There were actually early warning signs of defaults for Brilliance Auto Group. ![]() "The cash-strapped company has not obtained a renewed credit approval, which led to the failure to repay ," per the announcement. This is by no means the first such recent default by a state-backed firm. Announcements by Yongcheng Coal and Electricity Group and Qinghai Salt Lake Industry of defaults on bonds one after another in past weeks have severely eroded once nigh unshakable market trust in the solvency of state firms.īrilliance’s debt crisis erupted when it did not repay a CNY1 billion privately-placed bond that matured on Oct. ![]() The company has now piled up total debt defaults of CNY6.5 billion (USD21.96 million), together with overdue interest of CNY144 million, according to the announcement Brilliance issued on Nov. 18 - BMW's Chinese partner Brilliance Auto Group, plagued by recent debt defaults, has again failed to make good on CNY6.5 billion (USD987 million) in debt, with well-known financial institutions of the ilk of China Construction Bank and DBS Bank involved, according to the latest data the company released.
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