BOC delays NPL auction

Bank of China was prompted to delay its sale of US$724 million in non-performing loans (NPLs) to foreign investors due to fears of government interference if the loans were sold at excessively low prices, according to a report in the Financial Times. The loan sale, originally expected to be held by May, was to be the first direct auction of NPLs by one of China's top four state banks, which normally auction bad loans via affiliated asset management companies. The report cited bankers close to the sale as saying that the market for NPLs was in trouble, despite interest from foreign investors. China has about US$300 billion in bad loans held by banks.