India's floundering bank debt-for-equity deals a warning for China

Mumbai

INDIAN lenders are struggling to find new owners for unprofitable steel and infrastructure companies they took over under a debt-for-equity swap, a warning sign for China, which is launching a similar scheme.

Indian banks have either taken over or are in the process of seizing majority control in 18 firms with a combined debt of about US$15 billion, under a central bank plan that allows them to swop the companies' debt for equity and freeze non-performing loans, brokerage Religare Capital Markets estimates.