Moody's trims Country Garden

Moody's Investors Service said it downgraded Country Garden Holdings Co. Ltd.'s corporate family and senior unsecured ratings to Ba3 from Ba2.

"The downgrade reflects our expectation that Country Garden's liquidity buffer will further reduce due to its still constrained funding access and sizable refinancing needs over the next 12-18 months. Its financial metrics will also decline to levels not supportive of its previous rating level over the next one to two years because of declining sales and profitability," said Kaven Tsang, a Moody's senior vice president, in a press release.

On the positive side, the agency noted Country Garden’s monthly contracted sales have stabilized at around RMB 30 billion over the past two to three months; however, the 37% year-on-year decline for the first 10 months still signifies a weak contracted sales performance.

The outlook remains negative.

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