A three-shot cure for China’s zombie problem

The country should form new bad debt agencies, encourage foreign distressed debt specialists and create a proper bad debt resolution process, or risk a full-blown credit crisis.

A three-shot cure for China’s zombie problem

China’s four so-called bad banks have made a lot of money from gorging on bad debts. But they risk having too much of a good thing. 

On March 7, Lai Xiaomin, chairman of China Huarong Asset Management, said in a proposal to the National People’s Congress that the country’s four bad banks, aka asset management companies, were struggling to cope with the latest surge in soured assets. 

Huarong is one...

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