Dealing with Private Debt Distress in the Wake of the European Financial Crisis A Review of the Economics and Legal Toolbox

Author/Editor:

Yan Liu ; Christoph B. Rosenberg

Publication Date:

February 20, 2013

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

The private non-financial sector in Europe is facing increased challenges in meeting its debt servicing obligation. In response, governments are revisiting legal tools and—in some cases—institutional arrangements to deal with over-indebtedness. For households, where the problem in some countries is large but no established best practice exists, reforms have generally sought to allow debtors a fresh start while minimizing moral hazard and preserving bank solvency and credit discipline. For the corporate sector, efforts have focused on facilitating debt restruturing (including through out of court mechanisms). Direct government intervention has been rare.

Series:

Working Paper No. 13/44

Subject:

English

Publication Date:

February 20, 2013

ISBN/ISSN:

9781475544305/1018-5941

Stock No:

WPIEA2013044

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

21

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