Future of Leveraged Transactions in China

The requirement for a high level of leverage to finance a project is neither unusual nor taboo in China, and there has in the past been no shortage of willing borrowers, lenders and (most importantly) approval authorities keen to execute leveraged transactions.

However, most of this activity has been in the context of transactions generating tangible assets such as new plant and infrastructure. This is now being extended—with the enthusiasm of all concerned—to the consummation of structured financing transactions designed to finance the origination and carrying of financial assets such as loans, rentals and trade receivables. So does a thriving economy continue to expand.