(Yicai) Nov. 8 -- Shares of Ping An Insurance Group of China fell despite the country’s biggest insurer refuting a Reuters report that said Chinese authorities have asked it to take a controlling stake in troubled property developer Country Garden Holdings.

Ping An [HKG: 2318] slumped 5.4 percent to close at HKD38.50 (USD4.90) a share in Hong Kong today. Its mainland-listed stock [SHA: 601318] fell 1.5 percent to CNY44.63 (USD6.10). Country Garden [HKG: 2007] soared 12.2 percent to 83 Hong Kong cents (11 US cents).

Ping An said in a statement that the Reuters report was untrue, it had not been asked by the government to take over Country Garden, the nation's biggest private property developer, and take on its debt.

Ping An received inquiries from Reuters and provided written clarification to the news agency, it said, adding that the Shenzhen-based company deplores that Reuters went ahead and published the false report regardless.

Earlier today, the Reuters report cited people familiar with the matter that the State Council, China’s cabinet, has instructed the Guangdong provincial government to help arrange a rescue of Country Garden by Ping An, adding that it wants Ping An to own more than half of the builder.

Country Garden, which used to be China’s top real estate company by sales, recently fell into a liquidity crisis due to the prolonger downturn in the property market. The Foshan-based developer said on Oct. 10 that it is seeking a restructuring of its debt as the company expected not to be able to pay the interest on a note nor fulfill all of its overseas debt obligations on time

Country Garden has 15 offshore bonds with a principal of about USD9.3 billion, according to public information. In September, it won creditors' approval to roll over nine onshore bonds worth a total of CNY14.7 billion (USD2 billion).

Ping An had over CNY11 trillion (USD1.5 trillion) in assets as of Sept. 30, based on its third-quarter financial results. In the first nine months of this year, net profit fell 6 percent to CNY87.6 billion year on year, while revenue rose 5 percent to CNY704.9 billion (USD96.9 billion).

Editor: Emmi Laine