Shanghai: A leading Chinese business newspaper has reported that the nation’s largest private shipyard has run into financial difficulties. Rongsheng Heavy Industries Group has been accused by its largest creditor, Bank of China, for its unpayable massive loans, 21st Century Business Herald reports.
According to 21 Century Business Herald, the CBRC (China Banking Regulatory Bureau) would audit Rongsheng's loans credited by several banks including BOC, China Mingsheng Bank, China Bohai Bank.
Financial reports of Hong Kong-listed Rongsheng show that liabilities in 2009 reached RMB5bn, compared to RMB1.4bn in 2008.
However, by September 2011, a variety of banks had granted a combined RMB163bn credit line for Rongsheng.
This credit line has nearly disappeared as the yard grapples with no single order this year the newspaper reported adding also that local government subsidies provided more than half of the company’s net profit in 2010 and 2011. [10/08/12]