China to launch investigation into corporate bond risks

BEIJING (Reuters) - China’s state planner said on Wednesday it would launch an investigation and assessment into corporate bond risks, in an effort to strengthen management and reduce financial risks.

Local authorities will be required to conduct checks on companies’ ability to repay their bonds, and help resolve repayment risks to protect bondholders’ rights, the National Development and Reform Commission (NDRC) said in a statement on its website.

The NDRC also said it will encourage qualified firms to issue bonds to support infrastructure construction projects.

Corporate bond defaults in China hit a record last year as the economy slowed.

Reporting by Beijing Monitoring Desk; Editing by Kim Coghill