Evergrande sets up risk management committee amid default concerns
Published: Dec 07, 2021 01:40 AM
Evergrande Group Photo: CFP

Evergrande Group Photo: CFP

Real estate property giant China Evergrande Group has set up a risk management committee headed by Chairman Xu Jiayin, with the company teetering on the brink of default again and the share price plunging.

According to a document filed by the company on Monday, Evergrande's board of directors decided to set up a risk dissolving committee considering the company's current challenges in operation and finance. 

Members of the committee have different backgrounds, including senior executives as well as management staff from several leading companies, the statement noted. 

Xu has been appointed the committee's chairman. Hao Han, a partner of Zhong Lun Law Firm in Beijing, is also a member of the committee.

Evergrande said in the statement that it believes the committee could be helpful for the company to solve its current difficulties. 

The real estate giant's shares plunged to record lows on Monday after the company warned last Friday that it may not have enough capital to meet its financial obligations. The company has debts amounting to about $300 billion. 

It also faces the looming end of a 30-day grace period on dues of about $83 million, and Reuters cited two bondholders as saying that they had not received payments by the end of Asia business hours. 

The document warned Evergrande's shareholders and other investors to "act cautiously" when trading the company's shares.

Evergrande has been struggling with its deadlines in recent weeks as it grapples with the billions of liabilities. Global ratings firm S&P also noted recently in a report that Evergrande is very likely to default again as it has lost its ability to sell new homes.