Troubled China Evergrande will release a small portion of a repayment of a wealth management product (WMP) to investors, the developer announced on September 30.
The notice posted on its website said the wealth management unit has paid the first installment of 10 per cent for its wealth management products (WMPs) which is due by the end of September.
It came after nationwide protests over a missed payment earlier this month, as panicked home buyers and workers gathered outside its headquarters in China.
Wealth management products are uninsured securities and investments sold by banks and other financial institutions in China.
Currently, Evergrande asset management products have an estimated $6 billion outstanding in payments, while total liabilities are as high as $305 billion.
The cash-strapped property giant asked its employees to make a short-term, high-yield, loan to the company—otherwise, they would lose their bonus. Protesters told The Epoch Times that many workers also turned to friends and family for investment.
The company on September 13 introduced three options to repay retail investors in the WMP, including cash installments, discounted properties, or payments to investors remaining on residential units purchased by them.
China Evergrande, along with other heavily indebted groups, issued high-interest WMPs to investors – a popular method of borrowing that bypasses government debt restrictions.
In addition to the money owed, China’s former best-selling developer is now struggling with unfinished apartment complexes, unpaid bills and a missing stock price.
This News Originally From – The Epoch Times