After a two-year courtship that veered from friendly negotiations to broken promises and an ugly international lawsuit, Newbridge Capital, a feisty American private-equity firm, has beaten the world's biggest financial institutions to become the first foreigner to gain control of a Chinese bank. HSBC, Citigroup, Standard Chartered, the Asian Development Bank and the IFC, the private-sector arm of the World Bank, have also been scrambling to buy stakes in mainland lenders. Because individual foreign holdings in Chinese banks are limited to 20%, Newbridge will buy only 18% of Shenzhen Development Bank (SDB) from the government of Shenzhen, a boomtown bordering Hong Kong, for a reputed $150m. But the deal, sealed on May 31st, permits the Americans to appoint a majority of the 15-strong board. China's policymakers are eager to attract foreign expertise to help buoy the country's appallingly managed banks, most of which are drowning in non-performing loans (NPLs). For a start, SDB is small enough to let go of, with assets of only $25 billion, 300 branches and around 4,000 employees. The ownership of the bank, listed on the domestic Shenzhen stockmarket, is highly dispersed, with 72% in public hands, allowing Newbridge to gain a lot of power with a smallish stake. Newbridge also has an impressive track record. It transformed Korea First Bank, which it bought shortly after the Asian financial crisis, from a basket case with a bad-loan ratio of more than 50% into South Korea's soundest lender, with NPLs of just 1.4% of assets. Newbridge also rapidly reduced the bank's exposure to big, corporate borrowers such as Daewoo and SG Global, both of which in effect went bankrupt, and pushed into retail financial products, such as mortgages and credit cards. SDB's small size means that making such changes should be just about manageable within three to five years, even if, as seems likely, the bank's NPL ratio turns out to be much higher than the declared 10%.