International bond agencies, like Moody’s, S&P and Fitch Ratings, offer credit ratings from the top-rated AAA to C, which “are the lowest rated and are typically in default, with little prospect for recovery of principal or interest”, according to Moody’s. Photo: Shutterstock
International bond agencies, like Moody’s, S&P and Fitch Ratings, offer credit ratings from the top-rated AAA to C, which “are the lowest rated and are typically in default, with little prospect for recovery of principal or interest”, according to Moody’s. Photo: Shutterstock

China debt: will self-disclosed scandal bring back ratings credibility after series of bond defaults?

  • China has become the world’s second largest bond market after the US, attracting 600 billion yuan (US$91.7 million) of inflows in the first eight months of 2020
  • But a series of recent defaults of several top rated state-owned enterprises has hurt the credibility of home-grown bond rating services

Topic |   China economy
International bond agencies, like Moody’s, S&P and Fitch Ratings, offer credit ratings from the top-rated AAA to C, which “are the lowest rated and are typically in default, with little prospect for recovery of principal or interest”, according to Moody’s. Photo: Shutterstock
International bond agencies, like Moody’s, S&P and Fitch Ratings, offer credit ratings from the top-rated AAA to C, which “are the lowest rated and are typically in default, with little prospect for recovery of principal or interest”, according to Moody’s. Photo: Shutterstock
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