China Property Credit -
Trust financing fear overdone, but valuation not appealing

Chinese property bonds and stocks plunged last week after Reuters reported that
the China Banking Regulatory Commission (CBRC) has ordered trust companies to
report their exposure to Greentown China. This sparked market’s concern over
Chinese developers’ funding accessibility and a potential halt of trust or bank
financings. A widespread bout of selling was triggered, where some benchmark
bonds traded down 6-7 points on the news or 9-14 points for the week.