A further slowdown is likely in sales of bad debts taken off the books of the state banks as investors focus on other distressed asset opportunities, the Financial Times reported. Ted Osborn, a partner at PricewaterhouseCoopers, said that the four asset management corporations (AMCs) – the institutions set up in 1999 to arrange discounted sell offs of non-performing loans (NPLs) – would struggle to capture a big portion of the US$10 billion foreign investors plan on spending on distressed debt over the next three years. Foreign players will instead turn their attention to private equity investments, and high-yield lending to cash-starved projects. The AMCs need to lower their prices but they are also under pressure to return a profit and are often forced to take on NPL portfolios from the banks for far more than they are worth.
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