As you can see there is quite a lot of press about the idea of a "bad bank" being created.
The Bad Bank Assets Proposal: Even Worse Than You Imagined
Bad Bank? Bad Idea. There’s no viable model for buying and selling toxic assets.
What to Call the "Bad Bank"? You Tell Us
George Soros is Right About the 'Bad Bank'
There are still many questions regarding it's composition and whether it would be entirely a government entity or have participation from the private sector, especially private equity. If the federal government can set a low enough value for these toxic assets, then private equity may want to get involved to Workout these troubled loan portfolios. Of course, we're interested in the talent strategy or corporate recruiting strategy for creating a 'bad bank'. As experience bankers will tell you, the person who is a great lender cannot be a great workout person. Although you do see people who have done both, it's very uncommon. Over the next few days, we will be exploring the talent necessary to staff a 'bad bank' or a simple recruitment project for a special assets management team to manage a distressed loan portfolio.
Thursday, August 6, 2009
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