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South China Morning Post
15-05-2025
- Business
- South China Morning Post
Debt-laden China Vanke gets US$215 million loan from state-owned stakeholder
Indebted property developer China Vanke has secured a 1.55 billion yuan (US$215.4 million) loan from state-owned Shenzhen Metro Group, offering some respite as it looks to meet US$3.4 billion in debt obligations this year. Shenzhen's railway operator, Vanke's largest shareholder with a 27.2 per cent stake, is extending the loan to the cash-strapped developer to help cover interest and principal repayments, according to a stock exchange filing on Wednesday evening. The loan has a 36-month term and may be extended or repaid early upon mutual agreement. It carries an annual interest rate of 2.34 per cent, below the one-year loan prime rate banks offer to their most creditworthy clients. Repayments are structured with 0.5 per cent due every six months, with the remaining 97 per cent to be settled in the final instalment. Shenzhen Metro has given Vanke loans totalling 10.3 billion yuan this year, the filing showed. The financial support follows a government-led shake-up in February, when the southern city's authorities tightened control over the developer by appointing 10 new executives, replacing former CEO Zhu Jiusheng and chairman Yu Liang, who stepped down in January. The government intervention helped Vanke repay a dollar bond due on Monday, clearing its only such obligation of the year, Bloomberg reported, citing people familiar with the matter. But the positive development failed to ease growing concerns in the financial markets. Fitch Ratings on Wednesday downgraded Vanke's bonds further into junk territory, to CCC+ from B-. The agency also downgraded its Hong Kong subsidiary to CCC from CCC+.
Reuters
06-02-2025
- Business
- Reuters
Shenzhen government tightens control over Vanke with management changes, document shows
BEIJING, Feb 6 (Reuters) - The government in the Chinese city of Shenzhen has made 10 new management appointments at China Vanke ( opens new tab, according to an internal document seen by Reuters, in another move to tighten control over the property developer. Vanke, one of the best-known property company names in China and currently around a third owned by state-owned Shenzhen Metro, announced last month that Chairman Yu Liang and CEO Zhu Jiusheng have stepped down. Shenzhen Metro's Chairman Xin Jie became new chair of Vanke, whose financial woes have re-ignited concerns about the outlook for the crisis-hit property sector, while three other executives from Shenzhen state firms joined as executive vice presidents. In the latest move, 10 new appointments of executives from firms owned by the Shenzhen government asset manager, including Shenzhen Metro, at the mid-level management in Vanke were made this week, according to the document circulated internally. The roles of the executives at Shenzhen-based Vanke range from strategic investment to capital management and legal affairs to project development, the document dated Wednesday showed. Vanke declined to comment when contacted by Reuters on Thursday. Yu Liang, who stepped down from the role of chairman to executive vice president last month, will be in charge of macro research for strategy and real estate in his new role, according to a separate internal document. The latest development marks another step by the local government to increase state oversight and intervention to contain any non-repayment risks as the developer faces several debt maturity deadlines this year. Investors have cheered the last month's top management reshuffle that reinforced the government support, as it signalled the removal of near-term default risks and hoped it would bring some stability to the struggling property sector. Investors are seeing Vanke's ability to meet repayment obligations as an acid test of homebuyer confidence in the world's second-largest economy, amid initial signs of stabilisation in the property sector in the past few months. They worry that worsening financial woes at Vanke, which has forecast a record $6.2 billion net loss for 2024, could further shut off financing to the sector, squeezing developers that have not defaulted.
Reuters
27-01-2025
- Business
- Reuters
China Vanke shares set to jump after senior management reshuffle
HONG KONG, Jan 28 (Reuters) - Property developer China Vanke's Hong Kong-listed shares were set to open 8.7% higher on Tuesday following the announcement of a senior management change. China Vanke ( opens new tab said on Monday that Chairman Yu Liang and CEO Zhu Jiusheng stepped down. The company forecast a record $6.2 billion net loss for 2024, deepening liquidity concerns.
New York Times
27-01-2025
- Business
- New York Times
Another Chinese Builder Is Facing a Cash Crisis
China Vanke, one of China's largest property developers, said on Monday that its top executives were stepping down and warned of a $6.2 billion loss for 2024, the latest sign that China's grueling multiyear property downturn has not reached the bottom. In a filing in Hong Kong, Vanke said that its chairman, Yu Liang, would leave his post for 'work adjustment reasons.' Zhu Jiusheng, the chief executive, would resign 'due to health reasons,' the company said. The changes mark an effort by the local government to take greater control of the management of Vanke. Vanke's new chairman will be Xin Jie, the head of its biggest shareholder, an entity owned by the government of Shenzhen, where the developer is based. Vanke will also get three new executives from state-owned firms, according to the company, which added that it was undergoing 'temporary liquidity difficulties.' Mr. Yu will stay on as an executive vice president. In a separate filing, the company said it expected that it lost $6.2 billion last year, in part, because of plunging sales. Financial experts have grown increasingly concerned about Vanke's financial problems in recent months after it reported a $2.5 billion quarterly loss in October and started to warn about its ability to repay creditors. Last week, S&P Global and Fitch, two ratings firms, downgraded their outlooks for the company, citing worries over its ability to generate cash to make its debt payments as its sales slowed dramatically. Vanke has $5 billion worth of bonds coming due this year. Across China, dozens of real estate companies have defaulted on ballooning debt. Millions of home buyers have been left without apartments that they had paid for. But many experts had anticipated that Vanke would be able to weather the worst of the storm, in part because its largest shareholder is state owned, giving it more public financing. It had been placed on a government list of 'high quality' developers that China's banks were encouraged to lend to. The fact that Vanke is struggling to pay off it debts is another worrying sign for China's broader property market. The series of announcements on Monday were the first time the company has said anything publicly since Chinese media reported this month that Mr. Zhu had been taken away by police and that local officials had been sent to take over the company. The report was taken down within hours of its publication. Multibillion dollar losses, executive purges and state takeovers are no longer surprising developments in China's property sector. The country's biggest builders have collapsed under tens of billions of dollars of debt and the government is trying to come up with the resources to finish apartments. Last week, Country Garden, another property giant that defaulted on $187 billion of debt in 2023, was given more time to negotiate a restructuring deal with its creditors in a Hong Kong court. One year ago, the same court ordered Evergrande, which defaulted on more than $300 billion of debt in 2021, to be liquidated.
Yahoo
27-01-2025
- Business
- Yahoo
Chinese property giant Vanke warns of huge loss, CEO resigns
Indebted Chinese property giant Vanke said Monday that its CEO had resigned due to "health reasons", after state-backed media reported he had been taken away by authorities. The company also warned on Monday of a net loss of approximately 45 billion yuan ($6.2 billion) last year. Chinese outlet the Economic Reporter this month cited sources as saying that Zhu Jiusheng had been "taken away by public security authorities", but did not specify whether he had been formally detained. Vanke has not confirmed Zhu's detention but said in a statement on Monday that he "has applied to resign... owing to health reasons". Zhu "will no longer hold any position within the company", the firm said. Hong Kong-listed Vanke is part-owned by the government of Shenzhen and was China's fourth-largest real-estate firm by sales last year, according to research firm CRIC. Alongside other real estate titans, it has staggered through a years-long debt crisis, and on Monday in a filing at the Hong Kong Stock exchange warned of a net loss of approximately 45 billion yuan last year. "The Company deeply apologises for the performance loss and will make every effort to promote business improvement," it said in a separate statement. Two other top executives -- chairman of the board Yu Liang and company secretary Zhu Xu -- had left their positions "due to work adjustments" but would continue in other roles, according to the company. The Economic Observer article did not specify what offences Zhu may be alleged to have committed. It reported at the time that calls and messages to Zhu and people close to him had gone unanswered. Vanke did not respond to an AFP request for comment following the publication of the article. mjw-pfc/oho Sign in to access your portfolio
