**SEO Title:** Agricultural Bank of China Pursues Shimao Group in Hong Kong
**Meta Description:** Agricultural Bank of China takes legal action against Shimao Group in Hong Kong to recover 1 billion yuan in unpaid debt amid ongoing property sector struggles.
**URL Slug:** agricultural-bank-china-shimao-group-hong-kong
**Headline:** Agricultural Bank of China Takes Legal Action Against Shimao Group in Hong Kong Over Unpaid Debt
In a significant legal move, a subsidiary of Agricultural Bank of China Ltd. has initiated a lawsuit against the defaulted Chinese property developer Shimao Group Holdings Ltd. in Hong Kong, aiming to recover approximately 1 billion yuan (around $140 million) in unpaid debts. This action follows the bank’s unsuccessful attempts to collect a court-awarded sum from a mainland Chinese court, as revealed in court documents.
The lawsuit highlights the difficulties faced by creditors, including state-owned banks, in reclaiming funds from struggling property developers. The Chinese real estate sector has been in a prolonged downturn, characterized by numerous defaults and minimal signs of recovery. Shimao Group, once a leading developer in China by contracted sales, is currently embroiled in two lawsuits filed by a local branch of Agricultural Bank of China in Hefei, Anhui province, dating back to August.
The legal proceedings center on two loans that were secured by Shimao’s subsidiaries in Hefei during 2019 and 2020, with guarantees from the Hong Kong-listed Shimao Group and its affiliates. A mainland court had previously ordered Shimao and its subsidiaries to repay the outstanding debt of 999 million yuan, along with accrued interest and other costs, but compliance has yet to be observed.
Both Agricultural Bank of China and Shimao Group have not provided comments regarding the ongoing legal situation. Shimao, which was once rated as an investment-grade company, first defaulted on its offshore debt in July 2022. Additionally, China Construction Bank (Asia) Corp., another state-backed financial institution, had filed a liquidation petition against Shimao in Hong Kong last year; however, the case was dismissed after the company made progress on its $11.5 billion offshore restructuring efforts.
As the legal battle unfolds, it underscores the broader challenges within the Chinese property market, where many developers continue to struggle with financial obligations.
**FAQ Section:**
**Q: What is the current legal situation between Agricultural Bank of China and Shimao Group?**
A: Agricultural Bank of China has filed a lawsuit in Hong Kong against Shimao Group to recover 1 billion yuan in unpaid debt, following unsuccessful attempts to collect from a mainland court.