Chinese manufacturing group DunAn has issued a plea to government financial regulators for a bailout to help manage its $7 billion in outstanding loans, according to sources seen by the Financial Times.
In the letter the company mentions that its precarious situation could have knock-on effects on the economy and blames Beijing’s deleveraging drive for its “extremely serious liquidity difficulties.”
“If a credit default happens, it will deliver a serious blow to many financial institutions in Zhejiang and may even cause systemics risks,” read the letter to the province’s government.
The current challenge began when regional lender Zheshang Bank asked for early repayments on loans, restricting other banks from lending to DunAn.
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