According to the BBC, shares of the scandal-plagued China Huarong Asset Management have dropped by 50% following a state-backed bailout of nearly $6.6 billion.
The company’s shares resumed trading on the Hong Kong Stock Exchange on Wednesday after a nine-month suspension.
Huarong shocked Asian stock markets last August when it revealed a record loss of nearly $16 billion.
According to the report, the firm’s former chairman, Lai Xiaomin, was executed last year after being found guilty of corruption.
Huarong, one of four state-owned distressed-debt managers, ceased trading in its shares on April 1 of last year.
The move came after the company missed a deadline to file its earnings for 2020 at the end of March.
According to the report, this triggered a sell-off in Huarong’s US dollar-denominated bonds, which spread to the bonds of other Chinese companies.
Huarong, whose largest shareholder is China’s Finance Ministry, announced a $24.5 million profit for the first half of 2021 and a nearly $16 billion loss for 2020 in August.
The asset manager expanded far beyond its original remit during Lai’s tenure as chairman.
Investors saw the firm’s crisis as a litmus test for the Chinese government’s approach to corporate failures.
