Chinese developer Country Garden has won approval from creditors to extend a deadline for a key bond repayment, Bloomberg reported Saturday, narrowly avoiding a potential default.

Bondholders voted this week on whether to extend repayment terms on a key note worth 3.9 billion yuan ($535 million) into 2026.

Had they voted against, the company faced a default -- becoming the biggest Chinese real estate firm to do so since rival Evergrande in 2021.

But bondholders late Friday agreed to extend the deadline for repayment, due Saturday, until 2026, Bloomberg reported.

Country Garden did not confirm the outcome of the vote.

But the group -- which was China's biggest developer last year -- is not yet off the hook.

Another deadline looms next week for the repayment of $22.5 million in interest on two loans.

The firm was unable to deliver that payment in early August and was granted a 30-day grace period that ends Tuesday. It risks default if it does not deliver the payment.

Moody's further downgraded Country Garden's credit ratings this week from Caa1 to Ca, indicating obligations that are "highly speculative and are likely in, or very near, default".

The move was an outcome of the firm's "tight liquidity and heightened default risk, as well as the likely weak recovery prospects for the company's bondholders," the ratings agency's senior vice president Kaven Tsang said.

The property giant is grappling with significant debt, estimated at 1.43 trillion yuan ($196 billion) as of the end of 2022.

It reported a record 48.9 billion yuan loss for the first half of the year this week.