Some investors of overdue wealth products issued by Zhongrong International Trust reportedly sent letters to Chinese authorities demanding an explanation and plans for missed payments.
Investors that are owed money by Zhongrong International Trust sent complaints to China’s National Financial Regulatory Administration (NFRA) and the Central Commission for Discipline Inspection (CCDI), according to a «Reuters» report citing the letters.
The NFRA letter said that Zhongrong had missed payments on at least 22 products since July 28 with an outstanding value of about 160 to 200 billion yuan ($27 billion). It demanded reports on the underlying assets of defaulted products as well as a written statement to explain the situation and when overdue payments can be made. In the CCDI letter, investors also complained about the failed management of Zhongrong and huge losses.
Zhongrong – partly owned by Zhongzhi Enterprise Group which manages $137 billion in assets – has been in the spotlight after missing payments on products it issued due to lacking short-term liquidity. This led to a recent protest outside Zhongrong’s Beijing offices. Separately, local authorities have also formed a task force to study contagion risk.
