Shenzhen Metro Group Co. reported a record net loss of 37.5 billion yuan ($5.5
billion) for last year, its largest since at least 2006, driven mainly by losses
from its investment in China Vanke Co.. The metro operator, which holds about a
27% stake in Vanke, said the loss stemmed from equity investment losses and
impairment charges. The deficit widened about 12% from a year earlier,
underscoring the financial strain from Vanke’s prolonged liquidity crisis, as
the developer continues to rely on bond extensions to avoid default. Shenzhen
Metro also made a 0.1% impairment provision on over 30 billion yuan of loans
extended to Vanke.
