China's Bad Debt Cops Get Going

A firm named Cinda launches a huge workout that may reshape China's economy

China's finance mandarins have long known what ails the country's bank system: tons of bad debt. And the mandarins have long known the solution to the problem: Hive off the bad loans from the banks and work them out one way or another, even if it means taking over the companies that cannot pay and selling off assets at cut-rate prices. But workouts hurt, and the Chinese have shied away from such a painful step.

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