HONG KONG, Aug 8 Reuters Country Garden said on Tuesday it has not paid two dollar bond coupons due on Aug. 6 totalling 22.5 million, confirming market fears that the biggest privately owned developer in China is slipping into repayment troubles.

The bonds in question are notes due in Feb 2026 and Aug 2030 , the firm told Reuters. Both payments have 30day grace periods, according to investors citing prospectuses.

China39;s giant property sector has seen a string of debt defaults by cashsqueezed developers since late 2021, with China Evergrande Group, the world39;s most indebted property developer, at the centre of the crisis.

Country Garden, which had total liabilities of 1.4 trillion yuan 194 billion at the end of 2022 and large exposure in lowertier cities, told Reuters in a separate statement that it is improving capital arrangements to ensure the legal rights of creditors.

It added its usable cash had declined, showing periodic liquidity stress, due to a deterioration in the sales and refinancing environment, and the impact from various fund regulations.

The company has been holding fast, but it39;s hard to see the dawn light, it said, highlighting efforts to ensure home deliveries and debt repayments as the industry grapples with unprecedented difficulties.

Country Garden39;s Hong Konglisted shares fell 14.4, their biggest daily drop since December, and most of its dollar bonds sank to below 10 cents on the dollar, according to Duration Finance.

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