Oaktree Capital Management has become the first foreign distressed debt manager to establish a wholly owned unit in China.
Beijing’s financial authority announced on Monday the establishment of Oaktree (Beijing) Investment Management Co. with registered capital of USD$5.42 million.
The subsidiary will be headquartered in Beijing’s Chaoyang district according to the Beijing Local Financial Supervision and Administration Bureau.
Los Angeles-based Oaktree has already invested a total of $6.5 billion in Chinese distressed debt, via joint-ventures with parties including state-owned China Cinda Asset Management.
American companies will be allowed to obtain asset management licenses and purchase non-performing loans from Chinese banks directly under the Phase 1 trade deal between China and the US.
At present foreign asset managers are only allowed to purchase Chinese NPL’s via local intermediary companies.
Oaktree Capital was established in 1995 and manages over $120 billion in assets globally.
Oaktree currently owns a subsidiary in Shanghai that helps Chinese investors to acquire distressed assets abroad.