Evergrande Dollar Bonds Drop Most This Year After Caixin Report

China Evergrande Group, the country’s most indebted developer, slid in the credit and stock market Thursday after a local media report that regulators were looking into dealings with a banking unit that owns its bonds.

The China Banking and Insurance Regulatory Commission is examining more than 100 billion yuan ($15.7 billion) of transactions between the developer and Shengjing Bank Co., according to Caixin Media’s WeNews, which cited unspecified sources. Shengjing holds large amounts of bonds issued by Evergrande, WeNews said. Evergrande is the bank’s biggest shareholder.

The company’s 8.75% dollar note due in 2025 dropped 2.9 cents on ...