Huarong Sues Jushenghua for $650 Million Outstanding Loan

(Bloomberg) -- China Huarong Asset Management Co. is suing Shenzhen Jushenghua Co. to accelerate a 4.2 billion yuan ($650 million) outstanding principal payment.

Huarong loaned 5 billion yuan to Jushenghua in 2018 with a maturity date of June 15, 2021, according to a filing to the Shanghai Stock Exchange on Friday. Jushenghua has missed an interest payment of 89.7 million yuan, it said. 

The two companies are in talks to address the dispute, according to the statement. Huarong has asked the Beijing financial court to freeze some of Jushenghua’s bank accounts. 

Huarong, the country’s biggest bad debt manager, had roiled markets since it delayed its earnings report in March. Last month, it secured a rescue package from some of the nation’s biggest financial firms and, after a long delay, revealed a record loss of 102.9 billion yuan for 2020, slashing shareholder equity by nearly 85%. 

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With assistance from Bloomberg