Angry investors are showing up in Beijing this week to demonstrate their fury over a 1.3 billion yuan ($210 million) trust product that has so far failed to pay them.
On Tuesday, more than 30 investors from across the country lined up outside the offices of China Credit Trust Co. in Beijing, which had issued the product. Together, wearing orange vests that read “Pay back my blood and sweat money,” the group demanded answers and waved a banner that declared they were setting up a national committee to protect their rights.
China’s shadow banking sector has exploded in recent years, spawning many similar products, and economists expect that more defaults may come in months ahead.
The protesting investors told China Real Time that they’d each sunk at least 3 million yuan into the product, which was sold in 2011 at branches of the Industrial & Commercial Bank of China, the country’s largest lender by assets. They said they were promised a 10% interest rate, more than three times bank savings rates at the time, with the trust scheduled to mature this July.
But just before that date, investors said they were told that China Credit Trust Co. couldn’t immediately pay back the debt and would need up to 15 months to sell five coal-mining properties it had invested in and return money to investors. As China’s economy has slowed, coal prices have dropped and the industry faces issues of overcapacity.
