Bad Loans Part 3: Foreign Firms Find it Tough to Bid for Troubled Debt

(Beijing) — China's growing need to dispose of bad loans and other distressed assets is luring foreign investors into the market, but many say government restrictions and a reluctance in the country to deal with outsiders are preventing them from competing fairly with Chinese firms.

Several foreign fund management firms, including Oaktree Capital and KKR, have entered the market, setting up funds of their own or teaming up with Chinese asset management companies (AMCs) to buy and sell distressed assets, especially non-performing bank loans (NPLs).