SINGAPORE, (Reuters) – Distressed investors are now buying bonds from China Evergrande Group’s embattled developer China Evergrande Group according to one fund manager as well as the Financial Times newspaper.

Evergrande’s liabilities totaling $305 billion have sparked concern that its cash crunch might spread to China’s financial system. This worry has been eased by the Chinese central bank’s pledge this week, which is meant to protect homebuyers.

According to bondholders, Evergrande has not paid two of its bond interest payments for the past week. Its offshore debt totaling about $20 Billion trades at distressed levels.

The chief executive officer of U.S. fund manager Marathon Asset Management told Bloomberg television https://www.bloomberg.com/news/videos/2021-09-29/marathon-is-buying-evergrande-debt-ceo-bruce-richards-says-video on Wednesday that he had recently purchased Evergrande bonds.

The Financial Times https://www.ft.com/content/1cf5bb08-e588-4790-987e-34aa3f5a604a reported on Friday that U.S. funds Saba Capital Management, Redwood (NYSE:) Capital Management, Silver Point Capital and Contrarian Capital Management had also been buyers, citing people familiar with the matter.

Reuters outside New York hours did not immediately get back to Marathon or the four other funds.

The Evergrande dollar bonds traded below or at 30 cents in the past few weeks because of company difficulties paying suppliers, and as a result concern over the future increased.

Marathon CEO Bruce Richards stated that “We are in the market buying Evergrande credit and will continue to do so at very low prices.”

He said, “The question here is how much acquisition cost is relative to recovery value.” We are getting closer to believing it makes sense now. “Until this week, we hadn’t bought credit before.”