* Three or more of a firm's creditors can set up debt
* Committee should safeguard rights and interests of banks
* To also organise orderly debt restructuring for firms
SHANGHAI, Sept 9 Creditors of troubled Chinese
firms can set up debt committees to assist with debt
restructuring, the country's banking regulator said on Friday,
as more firms get into financial difficulties and are unable to
repay their loans.
As the country's growth rate stutters, increasing numbers of
borrowers are going bust and leaving China's banks with
trillions of yuan in soured debt.
The aim of the committee, which can be set up on a voluntary
basis, is to "guide firms with their debt restructuring, help
troubled firms to resolve their troubles," among other things,
the China Banking Regulatory Commission said in a notice posted
on its website.
A committee can be set up for any troubled firm which is
seriously in debt by three or more of its creditors, the notice
The committee should safeguard the rights and interests of
banks as well as organise orderly debt restructuring for firms.
Any financial institutions connected to the borrower, in
principle, can join such committees, the notice said.
(Reporting by Engen Tham and Beijing newsroom; Editing by