S&P lowers China SCE Property

Standard & Poor's said it lowered the long-term corporate credit rating on China SCE Property Holdings Ltd. to B from B+.

The agency also said it lowered the rating on the company's senior unsecured notes to B- from B, affirmed its cnBB- long-term Greater China scale credit rating and affirmed the cnB+ rating on the notes.

The outlook is stable.

The downgrades reflect an expectation that leverage will remain high over the next 12 months even though the company has improved its sales execution and revenue recognition, S&P said.

The downgrades also consider the aggressive increase in its borrowings over the past six months to fund land acquisitions. The company's greater appetite for debt and growth may make it vulnerable to a sudden market downturn, given the tightening credit environment, the agency said.

The company's concentration risk will remain high for the next two years, although geographical concentration in Quanzhou has improved somewhat since 2012, S&P added.

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