Latest news with #NewWorldDevelopmentCo
The Star
3 days ago
- Business
- The Star
Hong Kong bankers on edge over US$11bil loan
The stakes are so high that in many cases, the banks' chief risk officers have stepped in. — Bloomberg HONG KONG: Hong Kong bankers have become fixated on an US$11bil loan deal with unusually high stakes for the financial hub. New World Development Co (NWD), an embattled property developer controlled by one of Hong Kong's richest families, is aiming to complete one of the city's largest-ever corporate refinancing deals with more than 50 banks by the end of June after pushing back an initial deadline for this month. So far, at least 12 banks have agreed to terms while the rest are still talking, according to sources. Failure to reach a deal could lead to demands for immediate repayment. The repercussions would threaten both NWD and many of the banks which are already suffering from a sharp rise in non-performing loans from commercial real estate. The stakes are so high that in many cases, the banks' chief risk officers have stepped in, sources said. Even chief executive officers of banks are closely monitoring the situation with frequent updates, the people added, asking not to be identified as the matter is private. 'A NWD failure wouldn't break the system, but that destabilisation could be contagious,' said Brock Silvers, managing director at private equity firm Kaiyuan Capital. 'A 'delay & pray' strategy would buy time while doing little to alleviate underlying risk to the company or Hong Kong's broader financial system.' NWD aims to secure HK$87.5bil in refinancing. It has commitments exceeding HK$20bil from Bank of China Ltd, HSBC Holdings Plc and Standard Chartered Plc, local lenders Bank of East Asia Ltd, Fubon Bank (Hong Kong) Ltd, Hang Seng Bank Ltd and French lender Credit Industriel et Commercial SA along with several other financial institutions. NWD did not respond to a request for comment. The other banks are in the process of securing internal credit approvals. A deal of this magnitude can take time as credit committees scrutinise every detail, raising numerous questions to evaluate the risks involved. Some banks are waiting for lenders with greater exposure to sign on before they can secure their own internal approvals, said the sources. A couple of other top Chinese, Japanese and Singaporean banks are in the final stages of approving the loan, according to sources. 'If one or two lenders in the syndicate are unwilling to commit, will the others in the syndicate be willing to take up the rest of the refinancing? 'If yes, the impact to the banking sector would be limited,' said Cusson Leung, chief investment officer for KGI Asia. — Bloomberg
Bloomberg
28-05-2025
- Business
- Bloomberg
New World's Perpetual Bond Drops as Coupon Payment Date Nears
A perpetual bond issued by Hong Kong developer New World Development Co. fell to its lowest level in three months, as investors wait to see whether the company will defer June coupon payments. The 6.15% perpetual note slumped more than 4 cents to 54.8 cents on the dollar as of 4:23 p.m. Hong Kong time, heading for its lowest level since February, according to data compiled by Bloomberg News. Several other dollar bonds sold by the troubled builder slid about 2 cents.
Bloomberg
20-05-2025
- Business
- Bloomberg
New World Development's Perpetual Dance With Its Bankers
If there's a task you're not obliged to do, but it's expected nonetheless, will there be consequences if you choose not to? This is the question Hong Kong real estate giant New World Development Co. has to deal with. Last Friday, the company did not issue a notice to call back a $345 million perpetual bond, the deadline if it wants to redeem on the first reset date. As a result, the coupon rate will be stepped up to more than 10% from 6.15%, going by the current Treasury yield.
Bloomberg
28-02-2025
- Business
- Bloomberg
Billionaire Cheng Family's Property Firm New World Posts HK$6.6 Billion Loss
New World Development Co. 's woes persist as the company recorded a loss of HK$6.6 billion ($849 million) for the first half after writing down the value of properties amid a prolonged real estate slump in Hong Kong. The developer controlled by the billionaire Cheng family posted the loss in the six months ended Dec. 31 due to writedowns on its residential projects and commercial properties, according to a filing to the Hong Kong stock exchange Friday.
Bloomberg
19-02-2025
- Business
- Bloomberg
No Gold Ticket for Hong Kong's Cheng Billionaire Family
The succession drama of Hong Kong's billionaire Cheng family has been in the spotlight lately, largely because of its distressed real estate developer New World Development Co. There are two main debates going on. First, will the developer be willing and able to repay its debt? Investors are worried about local banks' exposure and how the builder's unravel might affect the city's financial stability. As of last June, New World had about HK$127 billion ($16 billion) of bank loans, and HK$61 billion of bonds and perpetuals outstanding.
