Trust Company in Guangdong Declared Bankrupt ����The Higher People's Court of Guangdong Province announced Saturday the bankruptcy of the Guangdong International Trust and Investment Corp (Gitic) and its four subsidiaries due to their failure to meet maturing debt obligations. ����This is the first case involving the failure of a non-banking financial institution in the nation, and a case that involves the largest sum of assets so far. ����"The bankruptcy of Gitic is handled according to law and international practice," said court president Lu Botao, adding that "it underlines the determination of the Chinese government to rectify and reform the financial sector, and it serves to protect domestic and overseas investors and help Guangdong's healthy economic development." ����The local court also assigned a special group to take over the failed company for assets liquidation and debts repayment. ����Set up in 1980 as an investment arm of Guangdong, Gitic was once active on the international capital market, raising funds for key projects in Guangdong. ����However, its poor management and illegal fund-raising have resulted in mounting debts, which already amounted to 36.17 billion yuan (about 4.3 billion US dollars) at present, against the company's assets of 21.47 billion yuan (about US$2.6 billion). ����Based on the liquidation by the central bank, the board of directors of the Gitic decided to apply for bankruptcy on January 11. ���� ���� Economicnews 1999-01-18 Page2 Full Story in Chinese