On December 17th, the official WeChat account of Haiyin Wealth announced that due to the recent economic downturn, the project has been delayed, causing inconvenience to investors. We deeply apologize! At present, Haiyin Wealth has established a special team to actively coordinate project stakeholders in planning disposal plans. According to the latest regulatory policies and industry guidance, Haiyin Wealth has voluntarily withdrawn and sorted out its existing business. The relevant plan will be provided to everyone by the end of the month.
Recently, investors have reported on multiple social media platforms that Haiyin Wealth's products have been delayed in redemption. Along with the news of delayed redemption, Haiyin Wealth (HYW. O) experienced a sharp drop in stock price on December 13th, with the lowest intraday drop of 51.30%. In the next two trading days, the stock price continued to decline by 15.94% and 14.57%. As of the close on December 15th, Haiyin Wealth quoted $2.37, a week long decline of up to 61.53%.
On the second day after the sharp drop in the stock price of Haiyin Wealth, on December 14th, Haiyin Wealth issued a statement acknowledging that some of its distributed asset-backed products had redemption issues. On December 15th, a letter from Haiyin Wealth to its clients mentioned that Han Hongwei, Chairman of Haiyin Wealth, stated that he would "safeguard the interests of clients and employees and firmly take responsibility until the end.".
Regarding the reason for the delayed redemption of the product, a circulating chat record shows that due to the bank's fund control and the fact that December belongs to the peak interest payment period for fixed income products, the settlement and receipt time of the product has been extended.
According to a report from China Fund News, the "active withdrawal and sorting out of existing business" mentioned in the official WeChat announcement of Haiyin refers to the benign clearance of non-standard fixed income businesses. These non-standard debt products, which were previously registered on the Golden Exchange, have been targeted towards real estate projects and supply chain finance, according to insiders.
Regarding the announcement regarding the consultation reception desk: 3rd floor, No. 88 Hufa Road, Nanqiao Town, Fengxian District, Shanghai, the reporter found that Baidu Maps shows that the above location is Huayan Development Zone, Fengxian District, Shanghai, which is far from the company's office location.
According to public information, Haiyin Wealth was established in the core area of Lujiazui, Shanghai in 2006. The company has more than 150 branches in more than 70 major cities across the country, and has gradually expanded its presence in Hong Kong, the United Kingdom, the United States, and other places. According to the financial report, as of the end of 2022, Haiyin Wealth has a customer base of 1464.18 million and a management asset scale of up to 40.1 billion yuan.
In March 2021, Haiyin Wealth was listed on NASDAQ in the United States, and its prospectus referred to it as the "largest provider of fixed income real estate products in China" and the third largest and fastest-growing third-party wealth management service institution in China. And disclose relevant data. As of June 2020, the transaction volume of private equity products was 52.774 billion, of which the transaction volume of real estate products was 39.203 billion, accounting for about 74%. There are a total of 456 products, including 316 real estate projects, accounting for approximately 69%.
Table: Private equity products of Haiyin Wealth as of June 2020 Source: Haiyin Wealth prospectus
For the above products, the prospectus indicates that the products provided by Haiyin are invested in real estate projects of well-known and well rated large developers such as Evergrande and Rongchuang, with a general term of 6-36 months.
At the same time, the prospectus also pointed out that due to the new regulations issued by the China Fund Industry Association on December 23, 2019, the fund industry association will no longer accept private fund filing applications for lending activities. Therefore, Haiyin Wealth purchased real estate products with debt nature from various local financial exchanges, which are not subject to registration and supervision by the fund industry association.
And just six months after the release of this prospectus, real estate companies such as Evergrande and Rongchuang have successively hit the jackpot, but at that time, there was no news of delayed redemption from Haiyin Wealth. Some professionals pointed out that in addition to real estate, urban investment and supply chain finance were added to the list of products issued later.
According to the insiders mentioned above, the products related to the benign retirement of non-standard fixed income business were invested in real estate and supply chain finance.
According to the semi annual report disclosed by Haiyin Wealth, the company's revenue in the first half of this year was 2.092 billion yuan, a year-on-year increase of 7.71%; The net profit was 120 million yuan, a year-on-year decrease of 49.01%. The current number of wealth centers of Haiyin Company has reached 185, and it is still expanding compared to 2022.