China’s Bankruptcy Law in Focus as Bond Issuers Test System

Chinese bond issuers are testing a bankruptcy system that has been around for a decade but only recently used to resolve defaults on notes.

Baoding Tianwei Group Co. and Dongbei Special Steel Group Co. are in the midst of court restructuring proceedings. Guangxi Non-Ferrous Metals Group Co. was declared bankrupt and went into liquidation in the southern city of Nanning in September, becoming the first issuer of bonds in the nation’s interbank market to suffer that fate, according to a report from media group Caixin at the time. Chinese courts accepted 1,028 bankruptcy cases involving all kinds of debt in the first quarter, ...