Evergrande Group, China Evergrande Group, China Evergrande

Evergrande Group, China Evergrande Group

With Gucci bags and Dyson appliances, Evergrande wooed retail investors | Malay Mail

With Gucci bags and Dyson appliances, Evergrande wooed retail investors | Malay Mail

23/9/2021 7:59:00 PM

With Gucci bags and Dyson appliances, Evergrande wooed retail investors | Malay Mail

SHANGHAI, Sept 22 — Lured by the promise of yields approaching 12 per cent, gifts such as Dyson air purifiers and Gucci bags, and the guarantee of China’s top-selling developer, tens of thousands of investors bought wealth management products through China Evergrande Group . Now, many fear they...

channel for the latest updates.SHANGHAI, Sept 22 — Lured by the promise of yields approaching 12 per cent, gifts such as Dyson air purifiers and Gucci bags, and the guarantee of China’s top-selling developer, tens of thousands of investors bought wealth management products through China Evergrande Group.

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Now, many fear they may never get their investments back after the cash-strapped property developer recently stopped repaying some investors and set off global alarm bells over its massive debt.Some have been protesting at Evergrande offices, refusing to accept the company’s plan to provide payment with discounted apartments, offices, stores and parking units, which it began to implement on Saturday.

“I bought from the property managers after seeing the ad in the elevator, as I trusted Evergrande for being a Fortune Global 500 company,” said the owner of an Evergrande property in the conglomerate’s home province of Guangdong surnamed Du.“It’s immoral of Evergrande not to pay my hard-earned money back,” said the investor, who had put 650,000 yuan (RM421,144.58) into Evergrande wealth management products (WMPs) last year at an interest rate of more than 7 per cent. headtopics.com

More than 80,000 people — including employees, their families and friends as well as owners of Evergrande properties — bought WMPs that raised more than 100 billion yuan in the past five years, said a sales manager of Evergrande Wealth, launched in 2016 as a peer-to-peer (P2) online lending platform that originally was used to fund its property projects.

Some 40 billion yuan of the investments are outstanding, said the person, declining to be named as they were not authorised to speak with the media.China Evergrande did not respond to a request for comment yesterday, which was a public holiday in China.

With more than US$300 billion in debt, Evergrande’s liquidity crisis rattled global markets this week. The company has vowed to repay WMP investors.Christmas promotionChina’s years-long effort to deleverage its economy has pushed companies to resort to off-balance sheet investments in search of funding.

After Beijing further capped debt levels of property developers last year, the most indebted players like Evergrande felt even more pressure to find new sources of capital to ease mounting liquidity stress, turning to employees, suppliers and clients for cash through commercial paper, trust and wealth management products. headtopics.com

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Evergrande Wealth started to sell WMPs to individuals in 2019 after a regulatory crackdown led to a collapse of the P2P lending sector, said the sales manager and another Evergrande employee who bought the WMPs.To attract investors, the sales manager offered gifts such as Dyson air purifiers and Gucci handbags to each person who bought more than 3 million yuan of WMPs during a Christmas promotion last year.

A product leaflet provided by the sales manager seen by Reuters showed the WMPs are categorised as fixed-income products suitable for “conservative investors seeking steady returns”.‘De-facto Evergrande product’In two products sold last November, a construction company in Qingdao was looking to raise up to 10 million yuan with annualised yield of 7 per cent in one and 20 million yuan with yields ranging from 7.8 per cent to 9.5 per cent, depending on the investment size, in another. Minimum investments were 100,000 yuan and 300,000 yuan, respectively.

Evergrande also usually offers additional yield up to 1.8 per cent to certain investors, which can push returns to above 11 per cent for a 12-month investment, said the sales manager.Proceeds were to be used for Qingdao Lvye International Construction Co’s working capital, the documents showed. The firm could not be reached for comment during a public holiday.

Repayment would either come from the issuer’s income or from Evergrande Internet Information Service (Shenzhen) Co, a subsidiary that runs Evergrande Wealth and promises to cover the principal and interest if an issuer fails to repay, the prospectus said. headtopics.com

The sales manager said the Qingdao company was working on Evergrande projects and would use the payment from Evergrande upon completion to repay investors.“It’s a de-facto Evergrande product,” the person said.Other highly leveraged Chinese conglomerates including HNA Group, which declared bankruptcy early this year, and China Baoneng have used similar products.

In a petition to various government bodies, a group of WMP investors in Guangdong accused Evergrande of inappropriately using money that should have gone to the issuers to fund its own projects, and not sufficiently disclosing the risks.They also complained that they were misled by the stature of its chairman, Hui Ka-yan, noting that he was seated prominently during a 2019 celebration of the 70th anniversary of the founding of the People’s Republic of China.

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“The investors trusted Evergrande and bought Evergrande’s WMPs out of our love for and faith in the Party and government,” they wrote. — Reuters Read more: Malay Mail »

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China Evergrande inches close to default deadline, investors wait | Malay MailNEW YORK, Sept 22 — China Evergrande Group , once China’s top-selling property developer, inched closer to a key deadline where it risks a default on its bonds, but world markets were calmer as investors and analysts played down the threat of its troubles becoming the country’s “Lehman...

Asian investors soothed by Evergrande bond plan | Malay MailHONG KONG, Sept 22 — Asian investors trod carefully today but nerves appeared to be settled by news that troubled Chinese property giant Evergrande had agreed a plan to repay interest on one of its key bonds, for now avoiding a default that many fear could hammer the domestic and global economy....

FBM KLCI dips 0.09pc as investors remain cautious over Evergrande, US Fed decision | Malay MailKUALA LUMPUR, Sept 22 — Bursa Malaysia’s key index ended easier in lacklustre trade due to weak market sentiment and a lack of buying catalyst as concerns persisted over Chinese property group Evergrande Group ’s debt and its impact on global markets. At 5pm, the benchmark FTSE Bursa Malaysia...

China can withstand Evergrande ‘shock’, says OECD | Malay MailPARIS, Sept 21 — China’s economy can cope with the fallout from the possible collapse of debt-riddled property giant Evergrande and contagion to other markets would be limited, the OECD’s chief economist said today. Global markets have seesawed this week over fears that the company’s... China will ensure such 'Shock' will affect the West too!

Global stocks steady as markets calm after Evergrande-led slide | Malay MailNEW YORK, Sept 22 — World stock markets stabilised yesterday and oil prices regained ground a day after heavy selling of risk assets, as investors assessed the level of contagion stemming from distress at developer China Evergrande and awaited central bank meetings. MSCI’s gauge of stocks...

Asian trade tense in the shadow of Evergrande and the Fed | Malay MailSINGAPORE, Sept 22 — Asian stock markets made a cautious start today and the dollar held firm amid lingering nerves about the fallout from a looming failure at developer China Evergrande and anticipation the Federal Reserve may move a step closer to tapering. Japan’s Nikkei fell 0.5 per cent....