China’s state planner said on Wednesday that local governments should inspect corporate bonds that will mature in the near future to check for risks of default.

The National Development and Reform Commission issued a notice calling for province-level authorities to designate “key targets of concerns” if they find cases of repayment risks in 2021 and the near future.

The commission said authorities should check for irregularities in how companies raise and structure capital, and must issue penalties in a timely manner if illegal activities are detected. Local regulators should also prepare contingency plans for sudden risks in enterprise bonds.

The goal of the inspections was to “prevent and resolve” major risks in the bond market and to check for hidden weaknesses, the commission said.

Authorities should also proactively communicate with bond issuers, lead underwriters and creditors to manage risks, the notice read.

The notice comes after a series of high-profile bond defaults involving state-owned companies, including Yongcheng Coal and Electricity, Huachen Automotive Group and chipmaker Tsinghua Unigroup.

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