Banks Seized $2.1 Billion of Bank Guarantees at China Evergrande Property Services
26th March 2022 | Hong Kong
Banks have seized $2.1 billion of bank guarantees & deposits at Evergrande Property Services Group, a key subsidiary of China Evergrande. China Evergrande Group have also announced that it is unable to meet a deadline to release its annual results for financial year 2021. China Evergrande is one of the largest property conglomerate in China, which had been preventing a default of interest payment of its $300 billion debt, but has officially defaulted on its debt on missed interest payments and with top credit rating agency Fitch Ratings downgrading Evergrande’s rating in December 2021. China Evergrande is founded in 1996 by Hui Ka Yan (Xu Jiayin). In 2009, China Evergrande went public in Hong Kong. At one point, Hui Ka Yan had a personal fortune of more than $30 billion. In 2021, his personal fortune is estimated at around $7 billion to $11 billion.
” Banks Seized $2.1 Billion of Bank Guarantees at China Evergrande Property Services “
China Evergrande
China Evergrande, one of the largest property conglomerate in China which had been preventing a default of interest payment of its $300 billion debt, has officially defaulted on its debt on missed interest payments and with top credit rating agency Fitch Ratings downgrading Evergrande’s rating in December 2021. An official default of China Evergrande means the company may not be able to restructure debt at a lower cost, and may trigger a widespread default and short-term pressure of property prices due to asset sale. China Evergrande is founded in 1996 by Hui Ka Yan (Xu Jiayin). In 2009, China Evergrande went public in Hong Kong. At one point, Hui Ka Yan had a personal fortune of more than $30 billion. In 2021, his personal fortune is estimated at around $7 billion to $11 billion.
China Evergrande is one of the largest property conglomerate in China with more than 1,300 real estate projects & 200,000 employees and business interests in electric cars, healthcare, consumer products etc, and has more than $300 billion of outstanding debts. China Evergrande is suffering from severe cashflow and little working capital, due to significant decline in property sales and obligations on interest payments.
Should China Evergrande defaults, the banking industry may start to face a loan write-down or lengthy recovery on their loans to China Evergrande, suppliers will receive an uncertain recovery, and homebuyers and investors will face uncertainties on their property purchase and investments.
Related:
- China Evergrande CEO Sold $56.5 Million of Bonds in Q3 2021 Before Bonds Default in December
- China Evergrande Founder Pledges $1.1 Billion Personal Assets to Prevent Default, Sells Private Jets & Luxury Properties
- China Central Bank Injects $71 Billion into Banking System, China Evergrande $300 Billion Debt Crisis
- China Government Warns of Payment Default by China Evergrande, Debts of $300 Billion
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