The latest sign of turmoil in the Chinese financial sector.. Postponement of payment of dues for “wealth products”

The latest sign of turmoil in the Chinese financial sector came as two clients of the Chinese credit company gongrong International Trust Co said that the company postponed the payment of “wealth products” amid reports of liquidity concerns at one of the company’s major shareholders, according to Bloomberg.

The company “nasiti property service” and the company “KBC Corp” (KBC Corp) first announced the news of the delay in payments in a statement on Friday evening. KPC, a manufacturer of carbon products, said in a statement to the Shanghai Stock Exchange that the overdue receivables are related to the 60 million yuan (8.3 million dollars) invested with “gongrong”, and will not affect the company’s operations.

The Chinese asset management company “Guangyi Enterprise Group” – a giant financial company in China whose business intersects with credit, private equity and wealth management companies-owns a stake in” guangrong“, and late last week, there was speculation that the late payments were associated with a liquidity crisis in” Guangyi”, which has about a trillion yuan of assets under management, according to Caixin.

The news about the delay in the payment of “gongrong” compensation comes at a time when investors have been on edge lately due to concerns about the health of the economy and financial markets in China.
The company “Country Garden Holdings”, one of the largest real estate developers in the country, hit the markets last week amid fears of default, announcing heavy losses in the first half of the year.