Moody’s eyes Ping An for downgrade

Moody’s Investors Service said it placed its ratings for Ping An Real Estate Co. Ltd. (PARE) and Ping An Real Estate Capital Ltd. (PARE Capital) on review for downgrade, including the PARE Capital’s Baa3 senior unsecured ratings.

The agency also placed the Baa3 backed senior unsecured rating on the notes issued under the medium-term note program by Fuqing Investment Management Ltd. and Fuxiang Investment Management Ltd. and guaranteed by PARE Capital. The outlook was stable.

"The review for downgrade reflects our view that PARE's financial strength would weaken to levels not commensurate with its standalone credit quality, as the lingering impact of China's prolonged property market downturn, slowing economic growth and rising risks of contingent liabilities from the company's legacy property projects would drag on the company's financial performance, its liquidity and its funding access," said Kaven Tsang, a Moody's senior vice president and the lead analyst for PARE, in a press release.

"The review also reflects uncertainties over the company's ability to restore its financial strengths and access to debt capital markets, as well as to maintain its strategic and economic values to Ping An Insurance (Group) Co. of China, Ltd. (Ping An Group) amid uncertain market prospects and volatile funding conditions," Tsang added.

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