BEIJING : China Merchants Bank said on Monday that it is urging the manager of a defaulted trust product providing funds for the indebted property developer China Fortune Land Development to seek a solution for its clients.
The Chinese bank said in a filing with the Hong Kong Exchange that it was a distributor for the trust plan managed by Daye Trust to raise 500 million yuan (US$77.20 million) for a sub-subsidiary of China Fortune Land Development, which also provided the irrevocable joint liability guaranty for the trust.
As of Aug. 16, Daye Trust, which joined the creditor committee of China Fortune Land, had not received repayments of the trust, which has expired, while the guarantor had not yet performed its responsibility, according to China Merchants Bank.
China Fortune Land Development has been suffering repayment failures as Beijing has tightened controls of the debt-laden property sector since last year. The Hebei-based industrial-park operator and developer said it and its units had accumulated overdue debts totalled 81.6 billion yuan as of July 30.
(US$1 = 6.4768 Chinese yuan renminbi)
(Reporting by Zhang Yan and Ryan Woo. Editing by Gerry Doyle)