China’s Zhongzhi Enterprise Group, a leading wealth manager, told investors it is heavily insolvent with up to $64 billion in liabilities, threatening to reignite concerns that the country’s property debt crisis is spilling over into the broader financial sector.
The firm, which has sizable exposure to China’s real estate sector, apologised to its investors in a letter that said it had total liabilities of about 420 billion yuan ($58 billion) to 460 billion yuan ($64 billion).
The liabilities compared to Zhongzhi’s estimated total assets of about 200 billion yuan, according to the letter, which was issued on Wednesday and was seen by Reuters.
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