US Firm to Control Chinese Bank

China's banking industry has long been the focus of reform-oriented economists and policy-makers in Beijing. Corruption, a history of bad loans, and banks' obligations to lend to unprofitable state-owned businesses have caused some observers to call the sector the Achilles heel of China's booming economy. Yet things may be changing. After negotiations that concluded this weekend, for the first time a foreign company will have a controlling interest in a Chinese lender. Newbridge Capital Ltd., an American private equity firm, is now set to become the largest shareholder in China's Shenzhen Development Bank. As more banks become publicly-held businesses, economists say, their management will become more accountable and hopefully improve the sector's overall health. "The truth is, nobody really owns China's banks now," explains one economist. "Even smaller shareholders would improve that, because then at least someone cares about their money." – YaleGlobal