Zhejiang Private Enterprises Reproduce Bankruptcy Crisis &Nbsp; Private Lending Collapse Risk Looming.

In August 14th, Feng Qinghua was escorted back to Quzhou by police. Just a week ago, he got hundreds of millions of dollars. Usury Unable to return and absconded in Danyang, Jiangsu, under the name of Zhejiang Fenghua Wood Industry Co., Ltd. and many other enterprises encounter creditors blocking the door.

In August 1st, Wang Hexia, the boss of Wenzhou giant Bang shoes company, was missing. On the same day, Xie Gongrong, the former deputy to the National People's Congress of Wenzhou, was prosecuted for the crime of illegally absorbing public deposits. He was told that he had illegally absorbed 170 million yuan into 58 individuals and an enterprise.

The survival dilemma of private enterprises in Zhejiang is still spreading. Zheshang Investment Research Association Secretary General Cai Hua pointed out to the newspaper that there are currently about 36 SMEs in Wenzhou, of which 30% are in semi shutdown or downtime.

Fenghua wood sudden death

"Feng Qing Hua ran! Go, move things. " In the early morning of August 9th, Zhou Hongfei, general manager of Fenghua wood, was surrounded by hundreds of strangers. Everyone said with a big mouth that Feng Qinghua owed hundreds of millions of dollars in usury.

Zhou Hongfei hastened to call Feng Qinghua's mobile phone when the phone was switched off. Feng Qinghua also borrowed about 1000000 yuan in cash and 350 thousand yuan in raw materials.

According to the Quzhou Provincial Public Security Bureau Qujiang Branch Economic Investigation Brigade registration, Qinghua still owed three banks altogether 33 million yuan loan did not return. Among private creditors, more than 4 million 500 thousand of the borrowers have borrowed more than 10, and 1 million of them have more than 20. Rumour has been heard that Feng Qinghua owes 130 million of the total.

A medium-sized enterprise with annual sales of 50 million and fixed assets exceeding 80 million has been operating normally in recent years. Why did it go bankrupt in a flash?

Fenghua wood industry Shareholder One of the old leaves told reporters that he was engaged in plate processing in early years, and bought a piece of land in Shen Jia Economic Development Zone, Quzhou in 2005. When the financial crisis hit in 2008, half of Feng Qinghua's factory buildings were built, and 8 million 600 thousand of CCB's loans were due to repay. He was forced to set foot in usury.

By the end of 2009, business has improved. He has set up Zhejiang Quzhou Fenghua decoration materials Co., Ltd., Quzhou Fenghua Wood Industry Co., Ltd. and Quzhou Fenghua Electronics Co., Ltd., with a monthly turnover of about 5000000 yuan.

At that time, Feng Qinghua changed Quzhou Fenghua wood industry to Zhejiang Fenghua wood industry, but as the property certificate was still registered as Quzhou Fenghua, it was difficult to borrow money from the bank because the collateral and enterprise name did not meet the requirements. So Feng Qinghua fell deeper into the morass of usury.

In August 4th of this year, Feng Qing Hua went to Jiangxi Jiujiang bank to borrow money, but saw that a group of usury that was due in August 9th could not be returned. He and his wife Cai Meihua ran away. A couple of days later, the couple were arrested in Danyang, Jiangsu.

Usury can kill people. Lao ye said Feng Qinghua had no gambling habits, drugs and other bad habits. In order to maintain the normal operation of enterprises, he usured the monthly interest of usury to 8 points -1 gross 2, and the monthly interest rate of borrowing 1 million would have to return to 80 thousand -12 million, which made Feng Qinghua unable to bear the burden of multiple pressures such as financing and production costs.

Coincidentally, Wenzhou JU Bang Shoes Co., Ltd. also collapsed due to usury. This is also followed by Wenzhou Tietong electrical appliances, Jiangnan leather, Portman, three flags, Tianshi electronics and other companies, and another well-known private enterprise declaring bankruptcy.

It is noteworthy that sudden death often occurs in a business. chain Reaction. For example, the three flag group has led to the breakup of capital chain due to over expansion, and Ji An Machinery Co., Ltd., because of the three flag guarantee of 16 million loans, is being pushed into debt by banks. Changlin hydraulic and pneumatic complete set Co., Ltd., odekang company and its legal representative are all recognized by the local court as "old Lai", and they are caught in the situation of bank debit and seizure of accounts. {page_break}

"Money shortage" controversy

Traditional SMEs seem to be in an unprecedented predicament.

Statistics from Zhejiang Bureau of statistics show that in the first half of this year, the number of Industrial Enterprises above Designated Size lost 4673, an increase of 23.5% over the same period, and the loss and loss rates of enterprises were 14.6% and 6% respectively. The total output value and profit decline of Zhejiang's 6.6 000 micro enterprises are also seen.

According to the statistics of Zhejiang Economic Commission, the net interest expenses of Enterprises above Designated Size in the first half year were 36 billion 998 million yuan, an increase of 34.4% compared with the same period last year, and the net interest expense of small enterprises increased by 45.5%. 56% of SMEs believe that loans are more difficult than last year.

"80% of Zhejiang's small businesses rely on private lending to maintain their business, with the highest annual interest rate of 180%." Cai Hua pointed out that the profit margins of general manufacturing enterprises are only a few points, and many enterprises are in danger of breaking the capital chain.

Zhejiang Provincial Federation of industry and Commerce found that Bank In general, small businesses will implement a 30%-50% lending policy with a benchmark interest rate. The discount rate will increase to 4%-5%, plus the deposit return, the purchase of financial products and the payment of financial intermediation fees. The actual cost of loans will be two times that of the bank's benchmark interest rate.

However, an official of the Wenzhou Banking Regulatory Bureau told this newspaper that the financing difficulties of SMEs already existed for a long time, not due to the current tightening policy. In recent years, some small and medium-sized enterprises regard the entity industry as a financing platform and invest funds in real estate, capital and other industries. Since the beginning of this year, the real estate market has been sluggish. Enterprises continue to withdraw industrial funds to protect investment in the property market, which is also an important reason for the tight capital chain of some enterprises.

The official said that in the first half of this year, local banks in Wenzhou increased their support for SMEs, and loans for SMEs increased by 20 billion 780 million yuan, an increase of 8.61%, accounting for 43.6% of the total loan balance. However, some SMEs who do not meet the requirements of bank credit policy can only turn to private lending market for financing.

According to the statistics of the Zhejiang banking regulatory bureau, as of the end of 6, the balance of loans of small business loans of banking financial institutions in the province was 12939 billion yuan, ranking the first place in the country, an increase of 109 billion 200 million yuan over the beginning of the year, an increase of 36.9% over the previous year, exceeding the average growth rate of loans by 21.6 percentage points.

Zhou Dewen, President of the Wenzhou SME Promotion Association, believes that there is a need to distinguish between small and medium-sized enterprises lacking funds. First of all, SMEs have their own life cycle. Secondly, some enterprises that blindly expand production and "three high" (high energy consumption, high emission and high pollution) industries themselves should not get more financial support.