September 28, 2023 (MLN): China's property giant, Evergrande, halted trading of its shares on the Hong Kong Stock Exchange on Thursday, as per notices issued by the bourse.
Trading in the entity's other two units; the property services and electric vehicle groups also stopped at 9:00 am PST today.
The halt in trading comes a day after a Bloomberg report that Evergrande's billionaire boss Xu Jiayin was being held by police under "residential surveillance," as APP reported.
Evergrande had only just resumed trading a month ago after the company was suspended for 17 months for not publishing its financial results.
On Sunday, the firm said it was unable to issue new debt as its subsidiary, Hengda Real Estate Group, was being investigated.
The property giant further said on Friday that the said meetings planned this week on a key debt restructuring plan would not take place, adding it was "necessary to reassess the terms" of the plan in order to suit the "objective situation and the demand of the creditors."
China's property sector is a key pillar of growth, along with construction, it accounts for about a quarter of the GDP and has experienced a dazzling boom in recent decades.
The massive debt accrued by the industry's biggest players has, however, been seen by Beijing in recent years as an unacceptable risk for the financial system and overall economic health.
Authorities have gradually tightened developers' access to credit since 2020, and a wave of defaults has followed, notably that of Evergrande.
Earlier this month, authorities in the southern city of Shenzhen said they had arrested several Evergrande employees, also calling on the public to report any cases of suspected fraud.
Another Chinese property giant, Country Garden, narrowly avoided default in recent months, after reporting a record loss and debts of more than $150 billion.
