Embattled property developer China Evergrande Group's CEO and financial chief have been forced out amid an internal inquiry into 13.4 billion yuan (US$1.9 billion) in deposits used as security guarantees for bank loans, which were later seized by creditors.

The management change comes as the Guangzhou-based property developer is facing a push by creditors to liquidate the company as it teeters under a US$300 million mountain of liabilities. The company has said it hopes to announce a preliminary restructuring plan for its debt by the end of this month.

Shawn Siu, an executive director of the company, will take over for CEO Xia Haijun, according to a stock exchange filing late Friday.

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Evergrande's preliminary investigation determined that about 13.4 billion yuan in deposits from its property management unit, Evergrande Property Services, had been used as guarantees for loans taken out by third parties and the loan proceeds were then diverted back to Evergrande for general operations, according to a separate filing.

The loan guarantees were made between December 2020 and August 2021 as the world's most indebted developer faced a cash crunch. Several of the loans were not repaid and the deposits seized.

Evergrande, the mainland's second-largest developer by sales, said on Friday that Xia, Chief Financial Officer Pan Darong, and an executive of its Hengda Real Estate Group subsidiary were all asked to resign after the internal inquiry uncovered their involvement in the loan arrangement.

The company said a committee conducting the investigation would seek to conclude the inquiry as soon as possible and issue a report.

The departure of Evergrande's top executives is the latest challenge for the company founded by Hui Ka-yan, once the wealthiest man in China.

Evergrande in December failed to pay the interest on US$645 million and US$590 million of junk bonds, even after a grace period, triggering a cross-default on its other borrowings.

Evergrande has not published its accounts since a June 2021 interim report when it disclosed 1.97 trillion yuan of total liabilities and has been warned it could face a delisting in Hong Kong. The company's shares last traded on March 20, losing US$22.9 billion in market value over the preceding 12 months.

The financial health of Evergrande and other property developers has been a major concern for investors over the past year, in part because of the large role the property market plays in China's economy.