DAC is a privately held investment manager and advisor focused on special situation investments with an absolute return objective. DAC sources, values, and manages Asian investments including single and multi-credit non-performing loans, distressed real estate, and distressed equity and structured financings. The firm was founded in 2002 and currently manages more than $400 million (US) across two funds (22 investments), several separate accounts and numerous investment-specific engagements across five countries in Asia. It is considered to be the largest buyer of mainland non-performing loans, having bought more than 45,000 soured loans from mainland China lenders since its founding. Phil Groves, DAC’s founding partner, shares his insight on DAC and the overall investment state of China.
What is the State of China’s Economy?
Is it headed for a major correction? Eventually yes, but not for the next couple of years, due to the regime change and its unique economy. So nothing drastic will take place. The key is for the leadership to control social unrest by implementing sound economic policy. Also, keep track of the savings rate, which has been very high, in part due to a lack of investment alternatives for the average Chinese national. If it decreases, it will certainly impact domestic investment as well as China’s appetite for foreign sovereign debt.