BEIJING (Reuters) – A major Chinese trust company has failed to make coupon and principal payments on dozens of investment products since the end of last month, a senior official from the group in question told investors. which reinforces fears of contagion from the real estate crisis to the financial sector.

Zhongrong International Trust has short-term liquidity problems, Wang Qiang, the company’s chief compliance officer, told investors, quoted by a source familiar with the matter.

The group has no plans to meet its repayment obligations for dozens of products that have expired, Wang Qiang told dozens of investors at the company’s Beijing headquarters on Monday, the source, who was present at the meeting.

Zhongrong did not immediately respond to a Reuters request for comment. Wang Qiang, who is also board secretary and legal counsel, could not immediately be reached.

Bloomberg first reported Zhongrong’s comments about the missed payments.

Zhongrong’s meeting with some investors comes after two listed companies said over the weekend that they had not received payment for maturing investment products from the company. fiduciary, which traditionally had a significant exposure to real estate.

Zhongrong’s missed payments have heightened concerns about the outsized real estate exposure of China’s shadow banking sector, worth $3 trillion, at a time when the faltering economy is already reeling from worsening the real estate crisis.

(Reporting Jason Xue, Ziyi Tang and Ryan Woo, Corentin Chapron, editing by Kate Entringer)

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