Large Chinese asset manager is bankrupt
The entire Chinese trust market is reeling. China's top auditor launched a review of all trust companies as early as 2023. One is now bankrupt.
Zhongzhi Enterprise Group is bankrupt. A court in Beijing has accepted the investment group’s bankruptcy and liquidation application, reports the Financial Times.
Zhongzhi is one of China’s largest insolvency administrators and is at the center of the country’s €3.5 trillion shadow banking market.
The asset manager was already searched by the police in November. At the end of last year, the company announced that 36.4 billion US dollars (33.4 billion euros) were missing.
China is now checking all trustees
Zhongzhi already stumbled last summer. The asset manager had failed to make several payments for very wealthy customers, the “Handelsblatt” reported. At the time, Zhongzhi managed $138 billion (€126.5 billion).
This means that the entire Chinese trust market is reeling. As early as 2023, China’s top auditor initiated an audit of all trust companies, the “Handelsblatt” reported. This affects around twenty asset managers.
Zhongzhi was founded in 1995. The company says it also owns coal mines in China. In total, the trustee has 4.5 billion tons of coal reserves and owns 30 mining rights. Through mergers and acquisitions, four other asset companies also belong to Zhongzhi – completely or partially.
