Evergrande’s wealth management under investigation | Goulburn Post


The Shenzhen government is investigating a unit of Chinese developer Evergrande, the city’s financial regulator told investors at the first sign of an official investigation into the wealth management crisis at the real estate giant. Evergrande, the world’s most indebted real estate developer headquartered in Shenzhen, owes US $ 305 billion (AU $ 418 billion) and is cash-strapped, raising fears its problems spill over into the system. Chinese financier. As its liquidity crunch worsened, the firm’s wealth arm earlier this month missed a payment on wealth management products (WMP), prompting protests from investors who fear they will never get their money back. money. In a letter to investors viewed by Reuters, the Shenzhen Financial Regulatory Bureau said that “relevant departments of the Shenzhen government have gathered the public’s opinions on Evergrande Wealth and are launching a full investigation into the issues related to the company.” It is also urging China Evergrande and Evergrande Wealth to work to reimburse investors, the letter said, which was sent following inquiries from investors. Neither Evergrande nor the Shenzhen government responded to requests for comment. China Evergrande, like other heavily indebted conglomerates, has issued high yield WMPs to investors – a popular borrowing vehicle that bypasses government lending restrictions. More than 80,000 people – including Evergrande employees, their families and friends as well as owners of Evergrande properties – have purchased WMPs through Evergrande which have raised more than 100 billion yuan (AU $ 21.23 billion) in the over the past five years, and 40 billion yuan of investments are exceptional, said an Evergrande Wealth sales and investor manager. Associated Australian Press

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