Troubled China Shadow Bank Warns of $36 Billion Shortfall
- Recoverable amount from asset sales likely to be low: firm
- Zhongzhi’s liqudity became a cause for concern in August
Zhongzhi, one of the country’s largest private wealth managers, is the latest financial giant to run into trouble amid a housing crisis and sluggish growth in the world’s second-largest economy.
Source: Bloomberg
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Embattled shadow banking giant Zhongzhi Enterprise Group Co. has revealed the depth of its financial difficulties, telling investors it is “severely insolvent” with a shortfall of $36.4 billion.
The privately owned wealth manager said liquidity has dried up and the recoverable amount from asset disposals is expected to be low, according to a letter sent to investors on Wednesday seen by Bloomberg News.