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Which of the following is NOT a reason for using a Bad Bank as a vehicle to add value in the loan sale process? a
Which of the following is NOT a reason for using a Bad Bank as a vehicle to add value in the loan sale process?
a Contracts for managers can be created to maximize the incentives to generate enhanced values from loan sales.
b The bad bank enables bad assets to be managed by loan workout specialists.
c The bad bank does not need to be concerned about liquidity needs since it does not have any deposits
d Moving the bad loans off the balance sheet of the good bank will improve the markets perception, and thus performance of the good bank
e The good bank bad bank structure increases information asymmetries regarding the value of the good bank's assets.
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