Skittish investors highlight China credit fears

Early redemption requests on domestic private placement notes add to nerves following a feared – but avoided – trust default in January.

A move by a group of investors in China to seek early redemption of private placement notes highlights the skittishness that exists in the market amid concerns of possible defaults within the system.

The three-year 6% private placement notes PPN issued by Luoyang Mining Group have attracted market attention as two investors asked for early redemption, rarely-seen in China in recent years.

Guangzhou Rural Commercial Bank and Bank of China Investment Management, who respectively bought Rmb100 million and Rmb50 million of the Rmb500 million PPNs, on Tuesday held a creditor meeting and voted with other investors to agree on a proposal to ask the company to...

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