China Tells Banks to Stress Test Their Evergrande Exposure
- Developer’s bonds and shares have slumped in recent weeks
- Evergrande says its operations remain normal, compliant
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Chinese regulators have instructed major creditors of China Evergrande Group to conduct a fresh round of stress tests on their exposure to the world’s most indebted developer, according to people familiar with the matter.
Authorities led by the Financial Stability and Development Committee, China’s top financial regulator, recently told lenders including Industrial & Commercial Bank of China Ltd. to assess the potential hit to their capital and liquidity should Evergrande run into trouble, the people said, asking not to be identified discussing a private matter. It’s unclear whether the results will lead to any official action.