China’s state-owned asset managers are being drafted in to help clean up some of the financial risks in the peer-to-peer (P2P) lending industry, following a wave of liquidity crises and anger among investors.
The China Banking and Insurance Regulatory Commission met with executives from the asset managers earlier in the week to discuss ways to tackle the P2P issue, Caixin confirms. The four institutions – Huarong, Cinda, Orient and Great Wall – have traditionally been tasked with managing bad loans from state banks. This is the first time they will turn their attention to P2P.
Sources told Caixin that the role of the AMCs will focus on the “custody, liquidation and restructuring of P2P assets,” but that they may also directly buy out certain P2P assets, particularly large-sum loans that exceeded regulatory caps.