What Happened On Aug. 15, the Sixth Division of State-Owned Asset Management, a military-affiliated company in western China's Xinjiang region, said that it had made up the repayment of bonds worth 500 million yuan ($73 million), two days after it missed the deadline to repay the loan that could have left the company in default. According to a statement, the local government financing vehicle (LGFV) made the overdue principal and interest payment on the morning of Aug. 15, narrowly escaping the fate of being the first government-linked financing vehicle to default in a decade. Why It Matters Despite the turn of events, the incident has increased concern about the growing risk of default on the enormous debts of many local governments and corporations, especially as the economy continues to slow.