China ups funding oversight of Evergrande housing projects

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BEIJING – Several local governments in China have set up special custodian accounts for property projects by the country’s most indebted developer Evergrande to protect funds earmarked for housing schemes from being diverted, reported media outlet Caixin.

Reeling under a US$305 billion (RM1.27 trillion) debt, the property giant missed a payment deadline on a dollar bond last week, and its silence on the matter has set global investors wondering if they will have to swallow large losses when a 30-day grace period ends.

The special accounts have been set up since late last month in at least eight provinces where Evergrande has the most unfinished projects, said Caixin today, citing a source close to the developer’s management team.

These include Anhui, Guizhou, Henan, Jiangsu, and cities in the southern Pearl River Delta, it said.

The accounts aim to ensure homebuyers’ payments are used to complete Evergrande’s housing projects and not diverted elsewhere, such as to creditors.

In some southern cities like Zhuhai and Shenzhen, the offices of the Housing and Urban‑Rural Development Ministry are also involved in overseeing and reviewing the funds used in such projects.


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