(Yicai Global) June 7 -- Shares of China Evergrande Group climbed after the property developer said it attached great importance to the very few overdue and unpaid commercial papers at some of its project companies and is arranging payment.

Evergrande [HKG: 3333] closed up 3.2 percent today at HKD11.78 (USD1.52). The stock had slumped since the end of last month on market rumors about financial difficulties at the firm, falling 15 percent from an intraday high of HKD13.04 on May 25 to HKD11.08 at the close on June 2.

“The firm has never delayed payment of loan interest and repayment of loan principal in the 25 years of its existence,” Evergrande said in a statement posted on the firm’s website today in its first public response to the rumors. Evergrande will pursue legal action against those who spread malicious rumors, it added.

Evergrande is operating normally, the Shenzhen-based company said.

Online rumors suggested that Evergrande had significantly reduced prices to attract people to buy houses with full payment and thereby recover funds. But the firm noted in a statement that the temporary big discounts for its recent May 31 Housing Shopping Festival were only available for houses not sold on buildings with a sell-through rate of 95 percent each as well as super large houses and shops.

Evergrande added that it has not changed the sales prices, discounts and payment methods for regular houses.

“The firm’s financial business with Shengjing Bank conforms to the country’s laws and regulations,” Evergrande said, denying rumors that the bank holds huge Evergrande bonds and has directly or indirectly injected over CNY100 billion (USD15.63 billion) into the company.

Founder Hui Ka Yan said yesterday that Evergrande will slash debt by CNY284.3 billion (USD44.3 billion) before the end of the month, indicating that the group remains committed to meeting regulatory borrowing limits, The Paper reported.

Property developers are under great pressure to seal down their debt levels. Last August, the People’s Bank of China and the Ministry of Housing and Urban-Rural Development set new financing rules for real estate firms to mitigate risk as the pace of borrowing hit record highs.

Editor: Peter Thomas