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Bad-Loan Shareholder Bust-Up Reveals Chaos of Sector

Jilin Financial Assets Management Co. Ltd. — the first asset management company set up in one of China’s rust-belt provinces — has run into trouble due to such an attempt to move into areas outside its original core business. Photo: VCG
Jilin Financial Assets Management Co. Ltd. — the first asset management company set up in one of China’s rust-belt provinces — has run into trouble due to such an attempt to move into areas outside its original core business. Photo: VCG

A legal dispute between the shareholders of a bad-loan specialist in Northeast China’s Jilin province has put the chaotic reality of the country’s asset management companies (AMCs) in the spotlight.

The industry is still dominated by four state-owned institutions in terms of asset base, but in an effort to foster bad-asset cleanup at the provincial level, the sector has been opened up to provincial-government-backed AMCs and some privately owned AMCs.

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