Moody’s not finished with China yet – negative outlook for 38 Chinese SOEs

From Moody’s on China:
– Changes outlook of 38 Chinese state-owned enterprises (SOEs) and rated subsidiaries to negative following sovereign action
– Moody’s has affirmed all the ratings of these SOEs and subsidiaries
The change in the Chinese sovereign rating outlook to negative indicates that the central government and regional local governments’ (RLGs) capability to support their SOEs on a broad basis could be weaker than we had previously assessed.In addition, a key driver in the change in the sovereign’s outlook is our assessment that the government’s balance sheet is exposed to growing contingent liabilities through RLGs, policy banks and state-owned enterprises (SOEs).