A provincial government in north-east China’s grains heartland has taken over a maize processor that had closed after a prolonged struggle with mounting debts, highlighting China’s unwillingness to allow local champions to fail in an era of slowing growth.

Provincial governments have stepped in to rescue companies in sectors from steel to solar, avoiding potentially painful defaults but adding to concerns over the quality of debt held by Chinese banks and the drag on the economy of unprofitable corporations.

Hong Kong-listed Global Bio-Chem, the third-largest corn refiner in the world and the largest in Asia, had racked up $1.9bn in debts to banks and local businesses, according to Chinese media reports. It had ceased operations at lossmaking production lines following protests by corn farmers who said the company had failed to pay them for their crop.