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Cost of borrowing Evergrande stock hits new high on debt fears

Headquarters of China Evergrande Group in Shenzhen

SINGAPORE (Reuters) - The cost of borrowing China Evergrande shares rocketed last week, data from research firm FIS Astec shows.

Short sellers borrow shares, sell them and hope to buy them back for a lower price. They are paying fees equivalent to annualised rates of 92%, FIS Astec figures as of Sept. 23 show.

That is up from 50% two weeks earlier.

Only about 2.2% of Evergrande's outstanding shares are on loan, the data shows. The Chinese developer owes $305 billion, is short on cash and its share price is down 83% this year.

Market participants have said the surge in borrowing costs reflects both rising enthusiasm for short positions in the company and a scramble to find stock to borrow as lenders have recalled shares to dump positions.

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Borrowing costs for some other developers have climbed, but not to the same extent, according to FIS Astec.

Annualised rates for Guangzhou R&F Properties' shares, for example, rose from less than 1% at the start of the month to 6.6% on Sept. 23.

(Reporting by Tom Westbrook; Editing by Alexander Smith)