Hong Kong developer’s default could send shock waves through property market: S&P

“Hong Kong’s residential property recovery may be slipping out of view,” the credit-rating agency said in a report on Thursday. “S&P Global Ratings believes that any distress event involving major Hong Kong developers could trigger cascading effects, hitting the financial strength of rated entities [while] raising the risk [to] bondholders.”

The developer was removed from the Hang Seng Index in November and is facing financial challenges after posting a record full-year loss of HK$19.7 billion (US$2.53 billion) last year.

As of June 30, the company had HK$123.7 billion in consolidated net debt, according to its annual report. NWD’s net gearing, or debt-to-equity ratio, stood at 55 per cent, ranking among the highest in the industry. In addition, it held interest-bearing loans and bonds amounting to HK$151.6 billion.