China’s $1.7 trillion hangover

China’s $1.7 trillion hangover

Up to 40% of China’s $1.7 trillion LGFV loans are at high risk of default. What’s a panicking Beijing to do?

The money network:

The money network:

Why crowdfunding threatens traditional bank lending

April 1998

Bargain hunters spread to Europe


First it was a trickle, now it's a stream. The deal-flow in high yield debt issues is swelling in Europe as buyers and issuers prepare for even lower interest rates and the homogenous euro currency bloc. They're all looking for opportunities in the narrow line between debt and equity: the high-yield market. But please don't call it junk. Rebecca Bream reports


Euro-trash?

If you believe the hype, 1998 is the breakthrough year for high-yield corporate debt in Europe. Already by the end of February more deals had been done than in the whole of 1997, a reward for the banks that have been dabbling in this market since the early 1990s. Changes in bank lending, investor flight from Asia and the onset of Emu are driving the market forward, say its promoters.

"The key to the development of any market is momentum," says Robin Doumar, co-head of European leveraged finance at Goldman Sachs. "We are reaching critical mass in the high-yield market right now, it's a very exciting time."

High-yield bond issues this year have included a Dm300 million ($164 million) issue in February from Fresenius Medical Care, the world's largest producer of dialysis products, and a £180 million ($269 million) issue from IPC magazines in March. These were swiftly followed...


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