Huarong Shares, Bonds Slump After Warning of $2.8 Billion Loss

Shares of Huarong tumbled as much as 16% in Hong Kong early Wednesday, heading for the lowest close since March. Photo: Bloomberg

(Bloomberg) — China Huarong Asset Management Co. Ltd.’s shares and bonds plunged after the bad-debt manager said it expected a net loss of 18.88 billion yuan ($2.78 billion) in the first half of the year as credit impairments surged.

The predicted loss compares with a profit of 158 million yuan the Beijing-based firm reported in the six months through June 30 last year. Credit impairment losses “increased significantly” in the current period while the firm also booked “significant” realized losses on some equity investments due to market volatility, it said in a filing Tuesday without elaborating.