China Evergrande Group’s weak controls and poor management decisions were to blame for a funding arrangement that ultimately led banks to seize $2 billion of deposits held by a subsidiary, an independent investigation found.
The property giant used deposits from six units of Evergrande Property Services Group Ltd., a separate Hong Kong-listed company, to borrow money between late December 2020 and early August 2021, when the developer was in need of capital. It was part of a complicated financing arrangement that involved dozens of third-party companies and loans from multiple banks.
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