China has more outstanding non-financial corporate debt than any other country, says Standard & Poor’s, having overtaken the US last year.
Corporate debt issued by Asian borrowers is expected to exceed that of North America and Europe combined by 2016, says the rating agency.
In a report published yesterday, S&P estimates that non-financial corporate debt in China reached $14.2tn at the end of 2013, compared with $13.1tn in the US.
From now until the end of 2018 Chinese companies are expected to borrow $20tn, a third of corporates’ debt requirements globally, a trend supported by the increased willingness of the Chinese authorities to allow more government-related entities to issue debt securities. China’s non-financial corporate issuance accounts for about 30 per cent of the global total. Up to one-third of this is sourced from the informal banking sector, according to S&P, which argues that therefore as much as a tenth of global corporate debt is exposed to a risk of a contraction in China’s shadow banks.
“The concern is that if China did experience a faster slowdown, property prices came off and there was an issue in the shadow banking sector, that would have significant knock-on effects globally,” said Paul Watters, head of corporate credit research at S&P.
The rating agency expects non-financial corporate issuers to seek up to $60tn in new debt and refinancing between now and the end of 2018, and that Asia-Pacific issuers will make up half. By this point Asia-Pacific would account for more than half the $72tn in projected debt outstanding, resulting in heightened global corporate credit risk, given the larger share of emerging market debt in the total.
“Gradually, there will be an increase in bond issuance [from these countries] sold to institutional investors,” said Mr Watters. “The most relevant issue for investors is what is the pace of disintermediation.”
S&P points to an additional risk in Asia-Pacific: that real estate sector debt has ballooned over the past five years, up 84 per cent. The energy sector showed the fastest growth in debt issuance over the period. In Asia-Pacific energy companies’ debt more than doubled. It grew 73 per cent in North America and more than 50 per cent in Europe.
The report also highlights the trend for European companies to increasingly access debt markets for financing, as bank lending in the region continues to contract. Capital market funding costs in the region remain at historic lows for higher rated borrowers, and non-financial companies have raised $530bn in the European bond markets over the past five years.
标准普尔(Standard & Poor)称，中国已超过美国，成为全球未清偿非金融企业债务最多的国家。