Goldman Sachs published a research report that several large-scale defaulting of high-yield bonds of real estate companies in Mainland China at the end of last year. Although no overdue payments have been seen in recent weeks, the tension has intensified. This is reflected in the debt swap or an increase in debt extension programs.

Considering the increased credit tension and continued market pressure, the bank increased its intra-room default forecast this year. Under the basic scenario, the default rate of high yield debt was 19% higher than expected 11.5%. It is more likely to be up to 31.6% (originally 25.4%) in pessimistic situations and 10.5% (originally 4.3%) in optimistic situations.

Goldman Sachs said there would be a large amount of UHY bonds due in the next few months, potential for more debt swaps or debt extensions, and more default cases. The bank estimated $3.6 billion in debt maturity for the remainder of January 2022, $3.3 billion in March and another $3.7 billion in April.

The bank's team of Chinese economists maintained moderate relaxation of housing policy in the Mainland this year, but there will be no major real estate demand stimulus.