Beijing plans securitization of major banks' non-performing loans

Beijing is planning to bundle billions of dollars worth of non-performing loans to be sold to international investors in an attempt to whittle away at the growing glut of bad debt at mainland banks, The Financial Times reported, citing local media. Regulators have reportedly already granted a quota of RMB50 billion (US$7.655 billion) for the first wave of such products, but the official figure for bad loans of RMB1.27 trillion suggests supply will easily outstrip demand. “How many global investors have been interested in the traditional [bad debt in China]?” asked one Hong Kong-based investor. “Not many . . . is a more complicated version of this going to change that soon? No.”