(Yicai Global) Sept. 20 -- Guangxi Nonferrous Metal Mining Group Co., a mining corporation in China's western province of Guangxi, was declared bankrupt yesterday by the Nanning Intermediate People's Court, making it the first company trading on China's interbank bond market to go into liquidation.
The state-owned company filed for bankruptcy in March with debts totaling CNY14.5 billion (USD2.17 billion) owed to 108 creditors. After its management failed to submit a reorganization plan within six months the Nanning People's Court annulled the mining group's restructuring application.
The crisis has had an impact on many Chinese financial institutions including the China Development Bank, Minmetals International Trust, Shenwan Hongyuan Securities, Shanghai Pudong Development Bank and China's bond market.
Guangxi Nonferrous has been operating at a loss due to unwise investment decisions coupled with the continued economic downturn. It was unable to repay two non-public debt-financing instruments worth CNY1 billion that matured in March and April.
Guangxi Nonferrous has a registered capital of CNY1.16 million (USD174,000), 16 wholly-owned or controlled subsidiaries and six equity affiliates. The bankruptcy ruling only involves the parent company, and the subsidiaries are operating as usual, Yicai Global has learned.