And then there's another group in which the loans are nothing more than pieces of paper. Because many loans may turn sour, buyers never buy them at full price. Investors paid a fraction of face value at Bangkok's commercial loan auction last December. Those taking over institutions try to avoid paying for bad loans on their books. Seoul also promised to buy back all loans that go bad within a year, and a portion of them in two years.
Asian investors can look for gold too, but for the moment, the top prospectors are foreign.
They have the money, and more important, they've done this before. Mergers and takeovers have been a constant drumbeat among Western financial institutions for years. So has the rehabilitation of troubled acquisitions and the repackaging of dud assets, particularly after the 1980s U.S. savings and loan debacle. GE Capital also came to prominence then. Institutions are diving in, sorting through massive amounts of often confusing and unreliable data, working with governments, lenders, borrowers and the public, and coming up with deals that make sense.