Hong Kong finance chief says city’s exposure to Evergrande ‘very minimal’ -SCMP

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October 3 (Businesshala) – Hong Kong’s exposure to debt-laden developer China Evergrande Group (3333.HK) is 0.05%, or “very low” of banking assets at HK$14 billion ($1.79 billion), the South China Morning Post told Sunday, citing the city’s finance minister.

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“It is very low and will not pose any systemic risk to us,” Financial Secretary Paul Chan told the newspaper, he said he had come to the conclusion after a recent audit of local banking sector exposure to the company.

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Chan also said that Hong Kong’s stock market was essentially subject to some volatility amid the recent mainland crackdown on some industries, but believed any setback would be temporary.

With $305 billion in liabilities, Evergrande has raised concerns that its cash crunch could rip through China’s financial system and spread globally, a concern it raised this week to protect the interests of homebuyers. The Chinese central bank has lowered its pledge.

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Evergrande has missed two bond interest payments over the past two weeks, bondholders have said, and its offshore debt, about $20 billion, trades at distressed levels.

Reporting by Donny Kwok; Editing by Christopher Cushing

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