China’s banking sector has traditionally served as a party-managed feeding trough for its inefficient, unprofitable state-owned enterprises (SOEs), most of which were technically bancrupt. Fear is a robust motivator. Bankers are preserving fairness capital at any value, and plenty of are doing what would have been unthinkable until now: deleveraging their steadiness sheet. I participated in a recent CFO roundtable and all however one financial institution in attendance have been ceasing or drastically reducing lending activity, and in many cases, promoting good-quality seasoned loans to de novo” establishments who are nonetheless in progress mode. Through the past 45 days, our bank has obtained a number of requests to purchase loans like this. Almost all…