SHANGHAI, April 27 (Reuters) - Offshore bonds issued by subsidiaries of Chinese state-owned bad loan giant China Huarong Asset Management Co fell on Tuesday after Fitch Ratings downgraded the parent company due to concerns over the strength of its government backing. Bids on a $250 million perpetual bond issued by Huarong Finance 2019 Co Ltd were quoted at 60 cents on Tuesday morning, down 4 cents on the day. The fall came despite Huarong repaying the principal and interest on a S$600 million ($452.32 million) bond issued by Huarong Finance 2017 Co Ltd on time on Tuesday. Huarong counts China’s Ministry of Finance as its biggest shareholder. Hurt by failed investments, aggressive expansion and a high-profile corruption case that culminated in the execution of its former chairman, the company has been in restructuring talks since 2018. Concerns that restructuring of Huarong’s debt could lead to a possible rerating and repricing of the world’s second-biggest bond market have weighed on Chinese dollar debt issuers. Fitch Ratings said late on Monday that it had downgraded the long-term issuer default rating of China Huarong Asset Management Co Ltd by three notches to ‘BBB’ from ‘A’, leaving the company on watch for potential further downgrades. In a statement, the rating agency said it had also downgraded notes issued by Huarong’s subsidiaries Huarong Finance II Co Ltd, Huarong Finance 2017 Co Ltd and Huarong Finance 2019 Co Ltd. “Fitch believes the government sponsor’s indication of support has not been as forthcoming amid China Huarong’s weakness in its offshore funding channel after the company announced a delay in publishing its annual results,” Fitch said. China Huarong’s missed March 31 deadline for filing its 2020 earnings results sparked a rout in its dollar bonds that spread into other issuers. Reuters reported on Monday that the company will release earnings as soon as next month and before the end of August, after China Huarong said it will miss a second April 30 deadline.