Transformer manufacturer Baoding Tianwei flags bond risk

Update Time：2015-04-16

Chinese transformer manufacturer Baoding Tianwei Group Co. has said it’s uncertain it can pay bond interest due next week.

According to Bloomberg, the company is unsure if it can make a 85.5 million yuan ($13.8 million) payment because of “huge losses” last year in its alternative energy business.

“As the economy slows and the government’s tolerance for defaults rises, Chinese companies’ default risks may increase,” said Liu Dongliang, a senior analyst at China Merchants Bank Co. in Shanghai. “But we can’t exclude the possibility that these troubled companies may get bailouts at the last minute.”