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"The Evergrande bankruptcy case is extremely complex with domiciliary company in Cayman Islands as holding company and assets in China. In the end, there will be little to nothing left for bondholders," predicts DMSA expert Dr. Metzler, referring to his former employer, rating agency Fitch, which had already downgraded the group's credit rating to C at the end of September, assigning a recovery rating of RR6 for outstanding bonds. Fitch therefore assumes that in the event of Evergrande's bankruptcy, only zero to ten percent of the capital invested by bond investors would be returned to them. Assuming an average return of five percent, international investors would have to immediately write off around $22.5 billion in the event of an Evergrande insolvency, as Metzler demonstrated in detail in its study "The Great Reset - Evergrande and the Final Meltdown of the Global Financial System" dated Oct. 24, 2021. (Note to editors: This study also includes a list of Evergrande's international creditors along with the amount of outstanding principal). But it may not stop at $22.5 billion in write-downs. In the meantime, DMSA senior analyst Metzler considers it quite possible that Evergrande could drag China's entire real estate sector down with it. This could have serious implications for major international banks such as HSBC. According to their figures for the third quarter of 2021, Hong Kong's largest bank alone has extended loans totaling 19.6 billion U.S. dollars to Chinese real estate groups. Assuming a recovery rate of five percent in the event of an industry-wide wave of bankruptcies triggered by Evergrande, HSBC alone would have to write off around USD 18 billion. If one also considers the limited possibilities of international banks to access assets in China (see above), there is much more at stake for HSBC: the default of the entire portfolio of Chinese corporate loans. And that, after all, is worth around $196 billion. "Such immense lending to Chinese companies, without a guaranteed possibility of accessing collateral in China itself in the event of bankruptcy, is irresponsible in my view," says financial expert Metzler. With a return of five percent, HSBC would have to write off around 186 billion dollars in this case. That would correspond to almost the entire equity capital of the bank. And would probably lead immediately to its bankruptcy. This would make HSBC a victim of the Chinese financial virus, which would then spread rapidly throughout the international financial markets. "The Great Reset - the final meltdown of the current global financial system - has long since ceased to be a purely intellectual thought experiment," concludes Dr. Metzler. Please find more information and the research report at www.dmsa-agentur.de About DMSA Deutsche Markt Screening Agentur GmbH: DMSA Deutsche Markt Screening Agentur GmbH, is an independent data service that collects and evaluates market-relevant information on companies, products and services. DMSA sees itself as an advocate for consumers, private customers and intelligent investors. The claim: to always look at companies and providers, products and services through the eyes of the customers. The customers are the focus of DMSA's work. For them, important and decision-relevant information is bundled and presented as market screenings. The aim is to create more transparency for consumers when selecting products, investments and services. Press contact: Inga Oldewurtel Press Officer mailto: oldewurtel@prio-pr.de Tel.: +49 176 62 26 18 97 Responsible for the content: DMSA Deutsche Markt Screening Agentur GmbH Wichertstraße 13 10439 Berlin Germany Michael Ewy Managing Director http://www.dmsa-agentur.de ------------------------------------------------------------------- Az OTS internetes oldalán található hírek, közlemények, fotók a forrásmegjelöléssel (OTS) szabadon és korlátozás nélkül felhasználhatók. Továbbközlés esetén a közzétevő köteles az átvett anyagot tartalmának torzítása nélkül, félreérthetőséget, rosszindulatú következtetéseket kizáró, az eredeti szövegkörnyezetnek megfelelő módon feldolgozni és megjelentetni. Az OTS hírek nem képezik az MTI hírkiadás részét, az MTI által szó szerint továbbított tartalomért minden esetben a beadó a felelős. © Copyright MTI nonprofit Zrt. Az OTS szolgáltatással kapcsolatban további információt a (06-1) 441-9050 telefonszámon vagy a ots@mti.hu elektronikus levelező címen kaphat.