Shares of Chinese property developer Sunac China Holdings Ltd tumbled as much as 13.5% on Tuesday.
SHANGHAI/HONG KONG: Shares of Chinese property developer Sunac China Holdings Ltd tumbled as much as 13.5 percent on Tuesday after a local media report said banks were looking at the company's credit risks after a major deal with rival Dalian Wanda Group.
Sunac announced a deal last week to buy tourism projects and hotels in the country from Dalian Wanda in a $9.3 billion deal, one of China's largest property deals. A large part of the deal would be funded by new debt.
The share price drop came after Chinese regulators told banks to stop providing funds for several of Dalian Wanda's overseas deals as Beijing looks to curb the group's offshore buying spree, sources told Reuters on Monday.
The shares had gained some ground by mid-afternoon trading and closed down 7.3 percent to HK$15.94, in line for their biggest one-day percentage decline since January.
Sunac's bonds due 2019 fell 6 points to around 99 cents on the dollar.
A report by Chinese publication Jiemian.com, citing unnamed sources, said earlier on Tuesday that some banks were reviewing risks associated with extending credit to Sunac, and halting some loans extended to the developer.
Responding to the report, Sunac Chairman Sun Hongbin told Tencent Finance News the company confirmed banks have started reviewing the company after its deal with Wanda. Another publication, China Business Journal, reported Sun said Sunac was in communication with the company's lenders.
"This is very normal; many of the banks have business with us and Wanda, they have to pay attention," Sun was cited as saying.
Sunac did not give an immediate comment on Sun's statements when contacted by Reuters.
Sun was elected on Monday to the board of directors of Leshi Internet Information & Technology Corp Beijing, the listed unit of embattled LeEco, into which Sunac has invested $2.2 billion.
Between 2014 and 2016, Allianz General Insurance Company (Malaysia) Berhad has stopped fraudsters with bogus insurance claims from pocketing RM 5.6 million.
Insurance fraud is a growing concern in Malaysia and Allianz General has been paying closer attention to fraudulent claims in recent years. Last year, the Company formed a Special Unit of trained investigators with over 30 years of experience in law enforcement and the legal system to detect, track and investigate insurance fraud cases.
“In the past few years, we have stepped up our game to show insurance fraudsters out there that the buck stops here. Allianz General is sending out a message, loud and clear that we have ZERO tolerance for fraud,” said Jayapragash Amblavanar, Head of Claims for Allianz General.
“Our zero tolerance approach towards fraud means that we invest a lot of time and money when fraud is detected, suspected or alleged. Insurance fraud is not a victimless crime, it hurts everyone else who pays their premium and good people should not be punished for someone else’s crime,” added Jayapragash.
Globally, insurance fraud experiences an upward trend during an economic downturn. In Malaysia, following the moderate economy growth last year, Allianz General saw a rise in Own Damage (OD) and Third-party Bodily Injury (TPBI) claims.
Between 2014 and 2016, Allianz General’s OD claims which exclude windscreen claims and theft claims rose 16 percent from while TPBI claims increased 36 percent with an average of at least six fraud cases reported in a month.
The fight against fraud assumes great importance with the phased liberalisation of the motor and fire insurance. Allianz General’s crackdown on fraudulent claims serves the Company well in an environment that encourages insurers to be competitive with the price of their product and service.
“Single digit cases being reported in a month may not seem like a big problem to some, but, it shows that insurance fraud is very real in Malaysia. So our commitment towards fraud control means being proactive and willing to take the necessary steps and put in place better controls to nip the problem in the bud,” he added.
“Fighting off fraud means we gain better financial freedom and flexibility to offer far better priced products to our customers and cementing our reputation as insurer that you can trust to do the right thing,” added Jayapragash. - Reuters
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