Fall/Winter 2002, Vol 27, Nos 3&4

Abstract: China, like with other Asian countries, is closely following the approach used by the United States through the formation of the Resolution Trust Corporation (RTC) to resolve its non-performing loan problem. The purpose of this article is to review China’s progress in attracting foreign investors to purchase the NPLs, and to evaluate a long list of factors that affect investor perceptions of uncertainty. These factors must be addressed before investors are likely to enter the Chinese market in force—a necessary requirement for the government to see higher NPL recovery rates and lower losses on loans made by the state-owned banks.