SHANGHAI, Oct 11 (Businesshala) – Fundraising by Chinese asset trust products fell more than 40% in September from a month earlier, the official Shanghai Securities News reported on Monday, as troubles at China Evergrande Group pushed investors toward the struggling sector. further reduced the appetite.
The newspaper, citing data from investment advisor UseTrust, said the newly-launched real estate trust product raised 16.2 billion yuan from investors in September, down 44.8% from the previous month. This follows a 24% drop in August and a 25% drop in July.
Evergrande’s financial crisis deepened in September as the developer, grappling with more than $300 billion in debt, missed payments on wealth management products, commercial bills and dollar bonds.
Chinese developers are already grappling with government debt restrictions and rising bond issuance costs. The rapidly shrinking market for asset trust products could further squeeze funding channels in the region suffering from slow home sales.
Conversely, trust products that invest money in capital markets saw a jump in popularity and fundraising, Shanghai Securities News said. (Reporting by Samuel Shane and Andrew Galbraith Editing by Mr. Navaratnam)