Default risks loom over wealth management products worth 35% of China's GDP

Shanghai

THE RISK of a default chain reaction is looming over the US$3.6 trillion market for wealth management products in China.

WMPs, which traditionally funnelled money from Chinese individuals into assets from corporate bonds to stocks and derivatives, are now increasingly investing in each other. Such holdings may have swelled to as much as 2.6 trillion yuan (S$545 billion) last year, based on estimates from Autonomous Research this month.