Self help! Henans 100 billion level state-owned enterprises promise to repay the first phase of 500 million principal after default

category:Finance
 Self help! Henans 100 billion level state-owned enterprises promise to repay the first phase of 500 million principal after default


Photo source: by reporter Li shaoting

Two bonds of Yongmei holdings defaulted again

On the evening of November 23, Yongmei holdings announced that due to the impact of the epidemic, the companys operating pressure and financing difficulties in the bond market, the companys liquidity problems, resulting in 20 Yongmei scp004 and 20 Yongmei scp007 failed to cash in full on schedule.

China CITIC Bank and Huaxia Bank immediately jointly announced that as the lead underwriter, they would urge the issuer to continue to actively raise cashing funds through various channels and strive to pay the principal and interest of bonds to investors as soon as possible.

This also means that the 20 Yongmei scp004 and 20 Yongmei scp007 expired on November 23 have constituted a breach of contract. This is a breach of contract by Yongmei holdings after the 20 Yongmei scp003 ultra short-term financing default of 1 billion yuan on November 10.

Wind data shows that the maturity of 20 Yongmei scp004 is 0.74 years, the coupon rate is 4.35%, the issuance scale is 1 billion yuan, and the maturity date is November 22 (postponed to November 23 due to weekend). The term of 20 Yongmei scp007 is 0.57 years, the coupon rate is 4.38%, the issuance scale is also 1 billion yuan, and the maturity date is November 23.

That means that up to now, Yongmei Holdings has three ultra short-term financing bonds with a total principal of 3 billion yuan, which have passed the deadline and cannot be paid back.

According to the 21st century economic report, the relevant person in charge responded to the default of 20 Yongmei scp004 and 20 Yongmei scp007, saying wait for the announcement, we are still trying to raise funds. According to the source, the issuer wanted to pay the interest first, but did not pay it in the end.

The meeting of defaulting bondholders was held urgently, and Yongmei holdings promised to cash 50% of the principal of the current period

Yongcheng Coal Company held the first short-term financing meeting of Yongcheng Coal Company on November 23, 2020. The meeting time is from 19:00 to 20:00, and the proposal to agree to the issuer to cash 50% of the principal in advance, to extend the remaining principal for 270 days, to keep the interest rate unchanged during the extension period, to repay the principal and interest at one time at maturity, and to exempt the current bond from default. If this proposal is passed, the issuer will first cash 50% of the principal of the current ultra short-term financing bonds, and the remaining principal will be deferred. The resolution will be announced on November 24.

Last night, 20 Yongmei scp003 holder meeting has been held. At the meeting, the relevant person in charge of the state owned assets supervision and Administration Commission of Henan Province said: first, the early support scheme of the state owned assets supervision and Administration Commission of Henan Province should continue to promote; second, the state owned assets supervision and Administration Commission of Henan Province will unswervingly promote the debt resolution and enterprise reform of Henan energy and its affiliated enterprises.

According to the 21st century economic report, according to the holder, Yongmei said that it would pay 50% of the paid principal of 20 Yongmei scp003 to the regulatory account of the lead underwriter before the agreement takes effect (i.e. November 24). After the agreement comes into effect, the principal contractor will be allocated by the clearing house.

Regarding the transfer of equity of Zhongyuan bank, the relevant person in charge of Yongmei said that the equity transfer of Zhongyuan bank was not a free transfer, but a consideration transfer. In order to raise funds as soon as possible, if we follow the procedures for the sale and purchase of state-owned assets, the evaluation period will be long. In fact, the stock price of Zhongyuan bank is 1 Hong Kong dollar per share, and the actual transfer is based on the price of 2 Hong Kong dollars per share. At the same time, it is included in the coal assets.

According to the relevant person in charge of Yongmei holding, Yuneng Chemical Group will no longer occupy the capital of Yongcheng Coal and no longer collect funds from November 10. Yongmei holding can control the funds independently, and the extension conditions of the later bonds are not better than this period. Now we should stabilize production and cash flow, strive for external support and increase asset disposal projects.

As of the end of October, the total assets of Yongmei holdings were 171.1 billion yuan, the total net assets were 38.3 billion yuan, and there were more than 35000 employees.

Cross default risk may be on the trigger

14 days ago, the default of 20 Yongmei scp003 has constituted a substantial breach of contract. Cross protection clauses have been set up in the existing public debt financing instruments of Yongmei. According to the relevant provisions in the prospectus, the cross protection clauses have been triggered by the default of the current bonds. According to the agreement, Yongcheng Coal has a grace period of 10 working days, during which the repayment of debts can be exempted from cross default, that is, if the principal cannot be cashed or extended before November 24, Yongmei will face a great risk of cross default.

Screenshot source: GF Securities Development Research Center

According to the 21st century economic report, many creditors believe that,

Photo source: photo web

Haitong Securities is suspected of manipulating the market

According to the interface news, recently, the default in the credit bond market has attracted market attention. In the default event of Yongmei holding bonds, a number of financial institutions were involved, including Haitong Securities and its related subsidiaries, Everbright Bank, Zhongyuan bank, industrial bank, China integrity international credit rating Co., Ltd. and Xigema accounting firm. That is to say, the main underwriter, securities companies, rating agencies, accounting firms and other bond issuing intermediaries were investigated.

Market speculation, Yongmei holdings default or with self financing related. Those close to the regulator confirmed this, but also said that the specific investigation is still in progress.

On November 22, according to the China government website, the financial stability and Development Committee of the State Council held its 43rd meeting on November 21 to study and standardize the development of the bond market and maintain the stability of the bond market. The meeting proposed that we should improve our political standing and earnestly fulfill our responsibilities. Financial supervision departments and local governments should proceed from the overall situation and in accordance with the requirements of comprehensively ruling the country in accordance with the law, resolutely safeguard the authority of the legal system, implement the regulatory responsibility and territorial responsibility, supervise and urge all kinds of market entities to strictly perform their main responsibilities, and establish a good local financial ecology and credit environment. What is worth noting is that the meeting called for a zero tolerance attitude to maintain market fairness and order. We should strictly investigate and deal with all kinds of illegal acts such as fraudulent issuance, false information disclosure, malicious transfer of assets and misappropriation of issuance funds in accordance with the law, severely punish all kinds of evasion and cancellation of debts and protect the legitimate rights and interests of investors. We should strengthen the self-discipline and supervision of the industry and strengthen the market restraint mechanism. Bond issuing enterprises and their shareholders, financial institutions, intermediary institutions and other market entities must strictly abide by laws and regulations and market rules, adhere to professional ethics, be diligent and responsible, be honest and trustworthy, and effectively prevent moral hazard. Source: Daily Economic News Editor: Wang Xiaowu_ NF

On November 22, according to the China government website, the financial stability and Development Committee of the State Council held its 43rd meeting on November 21 to study and standardize the development of the bond market and maintain the stability of the bond market. The meeting proposed that we should improve our political standing and earnestly fulfill our responsibilities. Financial supervision departments and local governments should proceed from the overall situation and in accordance with the requirements of comprehensively ruling the country in accordance with the law, resolutely safeguard the authority of the legal system, implement the regulatory responsibility and territorial responsibility, supervise and urge all kinds of market entities to strictly perform their main responsibilities, and establish a good local financial ecology and credit environment.

What is worth noting is that the meeting called for a zero tolerance attitude to maintain market fairness and order. We should strictly investigate and deal with all kinds of illegal acts such as fraudulent issuance, false information disclosure, malicious transfer of assets and misappropriation of issuance funds in accordance with the law, severely punish all kinds of evasion and cancellation of debts and protect the legitimate rights and interests of investors. We should strengthen the self-discipline and supervision of the industry and strengthen the market restraint mechanism. Bond issuing enterprises and their shareholders, financial institutions, intermediary institutions and other market entities must strictly abide by laws and regulations and market rules, adhere to professional ethics, be diligent and responsible, be honest and trustworthy, and effectively prevent moral hazard.