China Evergrande GroupThe world’s most indebted property developer finds itself under intense scrutiny, with staff in its asset management division detained by police in southern China.
Shenzhen police announced in a statement on social media on Saturday night that public security organs have taken criminal enforcement measures against Mr. Du Liang, general manager of China Evergrande Financial Wealth Management Co., Ltd., and other criminal suspects. Details of the number of arrests and charges were not specified.
According to reports of investor protests at China Evergrande’s Shenzhen headquarters in 2021, officials identified Du Liang as the general manager and legal representative of China Evergrande’s asset management division. It remains unclear whether the brewers are among those arrested.
China Evergrande did not immediately respond to a request for comment. Police said the investigation was still ongoing and encouraged investors to report any further financial crimes.
China Evergrande is at the center of a crisis in China’s real estate sector, which has been experiencing a spate of debt defaults since late 2021. This has significantly slowed growth in the world’s second-largest economy.
The beleaguered group is currently in the midst of a protracted debt restructuring and is selling off various assets. On Friday, it announced that a decision on its offshore debt restructuring, scheduled for September, has been postponed to next month.
Trading in the company’s shares was suspended for 17 months until August 28th. Ratings agency Moody’s on Thursday downgraded the outlook for China’s real estate sector from stable to negative. According to a report in the Bangkok Post, the company cited economic challenges that are likely to lead to a decline in sales despite government support.
A few weeks ago, Chinese developer Country Garden narrowly avoided a potential default by securing creditor approval to postpone a key bond repayment deadline. The developer’s total debt is approximately USD 187 billion.
Follow more of Tiger’s latest articles on our new Facebook page here.
business news
