18-12-21, 12:24
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Manager Disappears With $313m From Chinese Builder
Money Manager Disappears With $313m From Chinese Property Developer
A company that was once one of China's biggest property developers says it has "lost contact" with a wealth manager that has $313m (£235m) of its money.
BBC 18 Dec 2021
China Fortune Land Development says British Virgin Islands-registered China Create Capital was supposed to have invested the funds on its behalf.
Fortune Land told investors it has reported the issue to Beijing police.
This month, the firm unveiled plans to restructure its debts after defaulting on billions of dollars of bonds.
In 2018 one of Fortune Land's overseas operations signed a deal that entrusted a company called Wingskengo Ltd to provide investment management services to the property developer, according to a document filed this week with the Shanghai Stock Exchange.
The filing goes on to detail how, as instructed by Wingskengo, Fortune Land transferred $313m to China Create Capital.
Fortune Land said it had expected the investment to generate annual interest of 7% to 10% until the agreement was due to expire at the end of 2022.
However, Fortune Land said it is now unable to contact Create Capital, adding there is "no way to judge" what impact the missing money will have on its current and future profits.
Like several other major Chinese real estate companies, Fortune Land has seen its shares plummet in recent months as the industry was gripped by a debt crisis.
Its Shanghai-listed shares have lost more than 70% of their value this year after failing to meet its financial obligations.
However, Fortune Land said earlier this month that a group of creditors had approved a debt restructuring plan.
The agreement offered a potential lifeline to the heavily indebted company after it defaulted on billions of dollars of bond debt this year.
Debt Crisis
Fortune Land is just one of China's debt-laden property developers that came under intense pressure after Beijing launched a sweeping crackdown on excessive borrowing in the sector last year.
Industry giant Evergrande, which has around $300bn of debt, has been the most high-profile company to be engulfed by the crisis and has recently missed interest payments on some overseas bonds.
Meanwhile, rival developer Kaisa, which has offshore debt of $12bn, did not repay $400m of bonds that matured last week.
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