Asia-Pacific bond defaults surge amid China’s real estate crisis

Picture courtesy of The New York Times.

Asia-Pacific bond defaults are on the rise, outpacing the global average, amid China’s real estate crisis. A joint study by the Federation of Thai Capital Market Organizations (FETCO) and the Capital Market Development Fund (CMDF) highlighted a concerning uptick in debenture default rates, signalling a potential global crisis.

The study revealed that bond defaults occurred at a faster pace in Asia-Pacific, even though these bonds generally have superior credit ratings compared to other regions. The average time to default for these bonds is 3.5 years, more than twice as fast as the global average of 6.2 years.

Investors are concerned as bond default rates are rising around the world, FETCO and the CMDF noted in their research. Many companies both in Thailand and abroad have begun to experience more problems this year…