Abstract
AbstractAlthough Chinese banks are the major creditors for companies in China, their role in bankruptcy is often neglected. Even if this may be justified in the past, as banks did not assume an important role, it is not the case now as banks have become more proactive in the bankruptcy procedure and begin to conduct debt‐for‐equity swaps under the initiative of the government. This article considers the role of Chinese banks in bankruptcy both in and out of formal bankruptcy procedure. It argues that based on the reality of the country, especially its corporate governance structure, bank intervention is feasible for corporate rescues in China. The debt‐for‐equity swap scheme could be the start. Copyright © 2018 INSOL International and John Wiley & Sons, Ltd.
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