The Guardian

Chinese financial giant Zhongzhi files for bankruptcy: court



Chinese asset management giant Zhongzhi Enterprise Group has filed for bankruptcy and is unable to pay its debts, a Beijing court announced on Friday.

The incident comes weeks after police launched an investigation into the group after the debt-stricken financial giant declared bankruptcy.

A statement released by a Beijing court on WeChat said Zhongzhi “failed to repay his debts as they came due, his assets were insufficient to repay all his debts, and he clearly lacked the ability to repay them in full.” The company has filed for bankruptcy liquidation because of the current situation. .

The Beijing First Intermediate People's Court “certified that the application met the specified bankruptcy grounds'' and issued a “judgment accepting the application for bankruptcy liquidation'' on January 5th.

In late November, police in Beijing, where the group is headquartered, announced they had opened an investigation into unspecified “criminal suspicions,” adding that they had taken action against several suspects.

Zhongzhi, little known outside financial circles, had declared bankruptcy with an estimated $66 billion in arrears, according to a letter to investors cited by local media.

During China's real estate boom, many developers used Zhongzhi to finance their projects.

The company managed more than 1 trillion yuan ($141 billion) in assets, according to investment bank Nomura.

However, the group has been caught up in China's real estate crisis and is now unable to repay investors.

Zhongzhi's bankruptcy follows a downward spiral at real estate developer Evergrande that continues to hurt China's real estate sector and economy, raising concerns that it could have far-reaching implications for China's financial system. ing.

Source: guardian.ng

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