Bailout 7: Bank Goes Into Bankruptcy
Posted by adminSep 30
What happens when there is no equity infusion and the bank goes in to bankruptcy.
Sep 30
What happens when there is no equity infusion and the bank goes in to bankruptcy.
9 Responses to “ Bailout 7: Bank Goes Into Bankruptcy ”
goldman brothers lol
why can’t the bank just buy back all or realistically speaking, part of its shares so that at the very least it can portray an increase in their market value and restore some type of confidence?
i guess the bank is broke, coz it doesn’t even have money to pay the debt
“9:46 —> Assets less than liabilities. “Sal is correct. The liabilities recorded on the books are what you are liable or obliged to return to the true owners – one day. Ie the deposit owners or the savers with you. The Assetts are A) What you have *and* B)what you *dont* have that are held by somebody else that you are entitled to have returned to you (which are derived from the depositors monies lent to you which you lent out for a profit difference).
Good stuff.. I becoming very fond of you sir..
What is meant by “bondholders” at the very end? Does that mean the creditors or the people who initially issued that loan and now took over the entity? How would one become one of these people anyway?
“What is meant by “bondholders” at the very end?”A bond is a promise or “I owe you”. So if you start up a bank you hand over money, and the bank owes you money and probably pays you interest as described on the document that is the bond or IOU.
9:46 —> Assets less than liabilities.
Yeah, but as part owner/shareholder of that Company, you’re no longer entitled to that share. The Company that you previously owned a share in has been bankrupt, and is now owned by your creditors.