S&P Global Ratings lowered its long-term issuer credit rating on Oceanwide Holdings Co. Ltd. to CCC from B-, with a negative outlook.
The rating agency also lowered its long-term issue rating on the Chinese real estate developer's outstanding senior unsecured notes to CCC- from CCC+.
S&P Global Ratings attributed the downgrade to its belief that Oceanwide does not have enough offshore cash or liquid assets, which it noted is prompting uncertainty over the refinancing of the company's large outstanding debt maturities, notably its US$200 million senior notes due in July and its US$600 million senior notes puttable in August.
The agency also believes the developer will face struggles in obtaining trust loans amid China's ongoing regulatory tightening around alternative financing. Roughly half of Oceanwide's total outstanding borrowings are in trust loans, S&P Global Ratings said in a release.
The negative outlook further reflects S&P Global Ratings' expectation that the company's debt maturing in 2018 will take a toll on its liquidity.
This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings. The original S&P Global Ratings documents referred to in this news brief can be found here.
