(Yicai) June 21 -- Orient Group's stock price continued tanking for the third straight day after the indebted Chinese conglomerate, which is a shareholder of Minsheng Bank, said it is unable to take out large amounts of money from a unit with deposits of over CNY1.6 billion (USD220.3 million).

Harbin-based Orient Group [SHA: 600811] closed 9.9 percent lower at CNY1 (US 14 cents) in Shanghai today, resulting in a nearly halved market cap since the beginning of this year.

The operator of agricultural and port business said on June 18 that it is restricted from withdrawing large amounts of money from subsidiary Orient Finance without disclosing the reason. The next day, Zhang Hongwei, the actual controller, promised to sell assets to ease the company's liquidity pressures.

The Shanghai Stock Exchange issued a notice to Orient Group on June 18, asking it to examine the use of deposits in financial affiliates and clarify whether the controlling shareholder or related parties misappropriated relevant funds.

Orient Group's liquidity problems are becoming more severe. In the past three years, the company has lost CNY400 million (USD55 million). As of the end of last year, some CNY27 billion (SUD3.7 billion) of its assets were tied, accounting for 71 percent of the total, mainly referring to pledged loans.

Market participants are paying attention due to Orient Group’s notable stake in Beijing-based Minsheng Bank and its large balance of loans given by the commercial lender. The conglomerate had nearly 1.3 billion shares as of March 31, or 2.9 percent of the lender's total.

The pair's management is linked as since March 2014, Zhang Hongwei, the actual controller of Orient Group, has been the chairman of Minsheng Bank. During this period, Minsheng Bank has given bigger and bigger loans to the shareholder.

As of the end of last year, Orient Group's balance of short-term loans from Minsheng Bank tallied CNY650 million whereas non-current liabilities due within one year exceeded CNY4.5 billion. In other words, Orient Group will need to repay nearly CNY5.2 billion in loans to Minsheng Bank this year. In total, it must fork over close to CNY9.6 billion.

So far, Minsheng Bank has not said that Orient Group is in arrears.

Editor: Emmi Laine