Chinese Shadow Bank Zhongzhi Files for Bankruptcy Amid Real Estate Crisis

The collapse of the company, which has debts of up to $65 billion, could impact market confidence and the ailing real estate industry.

Zhongzhi Enterprise Group, a Chinese shadow bank, has filed for bankruptcy due to its inability to pay off its debts, which are estimated to be around $59 billion to $65 billion.
Zhongzhi's downfall is the latest in China's ongoing real estate crisis, which has seen a wave of defaults across the sector and a significant drop in property values.
Chinese authorities had decided in October that bankruptcy would be the most effective approach to limit the effect of Zhongzhi’s struggles on financial markets.
Zhongzhi had financed many large Chinese property developers, including Evergrande, which is also facing a liquidation hearing later this month.
Analysts warn that while Zhongzhi's creditors are mostly wealthy individuals, its collapse could hurt general market confidence and renew concerns over the trust industry and its implications for the ailing real estate industry.