{
  "title": "The Economics of Bank Restructuring: Understanding the Options",
  "publication": "IMF Staff Position Notes, June 5, 2009",
  "sourceUrl": "https://www.imf.org/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996",
  "canonical": "https://www.imf.org/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996",
  "overlayPath": "/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996/index.md",
  "summary": "Based on a simple framework, this note clarifies the economics behind bank restructuring and evaluates various restructuring options for systemically important banks.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- Based on a simple framework, this note clarifies the economics behind bank restructuring and evaluates various restructuring options for systemically important banks.\n- The note assumes that the government aims to reduce the probability of a bank’s default and keep the burden on taxpayers at a minimum.\n- The note acknowledges that the design of any restructuring needs to take into consideration the payoffs and incentives for the various key stakeholders (i.e., shareholders, debt holders, and government)."
    },
    {
      "heading": "Key assumptions and focus",
      "content": "- Government objective: reduce the probability of a bank’s default and keep the burden on taxpayers at a minimum.\n- Framework emphasis: payoffs and incentives for key stakeholders—shareholders, debt holders, and government."
    },
    {
      "heading": "Restructuring options and concepts evaluated",
      "content": "- Asset guarantee\n- Asset management\n- Asset sale\n- Asset valuation and asset quality considerations\n- Debt-for-equity swap\n- Preferred shares\n- Securities, including SPN\n- Approaches to handling distressed assets and bank assets"
    },
    {
      "heading": "Stakeholders and incentives",
      "content": "- Shareholders (equity holder): considerations regarding dilution, retention, or removal of equity value.\n- Debt holders: treatment options, including exchanges and guarantees.\n- Government: balancing default-risk reduction with minimizing taxpayer burden.\n\n---\n\n Content in this bundle\n\n- spn0912 — Executive Summary\n  - spn0912 — Executive Summary (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - spn0912 — Executive Summary (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996"
    }
  ],
  "bullets": [
    "[Markdown version](/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996/index.md)",
    "[Structured JSON version](/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996/index.json)",
    "[Bundle manifest](/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996/bundle-manifest.json)",
    "Authors: Kenichi Ueda",
    "Published: June 5, 2009",
    "Series: IMF Staff Position Notes",
    "DOI: https://doi.org/10.5089/9781462337422.004",
    "Based on a simple framework, this note clarifies the economics behind bank restructuring and evaluates various restructuring options for systemically important banks.",
    "The note assumes that the government aims to reduce the probability of a bank’s default and keep the burden on taxpayers at a minimum.",
    "The note acknowledges that the design of any restructuring needs to take into consideration the payoffs and incentives for the various key stakeholders (i.e., shareholders, debt holders, and government).",
    "Government objective: reduce the probability of a bank’s default and keep the burden on taxpayers at a minimum.",
    "Framework emphasis: payoffs and incentives for key stakeholders—shareholders, debt holders, and government.",
    "Asset guarantee",
    "Asset management",
    "Asset sale",
    "Asset valuation and asset quality considerations",
    "Debt-for-equity swap",
    "Preferred shares",
    "Securities, including SPN",
    "Approaches to handling distressed assets and bank assets",
    "Shareholders (equity holder): considerations regarding dilution, retention, or removal of equity value.",
    "Debt holders: treatment options, including exchanges and guarantees.",
    "Government: balancing default-risk reduction with minimizing taxpayer burden.",
    "**_spn0912 — Executive Summary**"
  ],
  "related": [
    {
      "title": "_spn0912 — Executive Summary",
      "role": "document",
      "sourceUrl": "https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/spn/2009/_spn0912.pdf",
      "summary": {
        "path": "/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/spn/2009/_spn0912.pdf.md",
        "mime": "text/markdown"
      },
      "binary": {
        "path": "/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/spn/2009/_spn0912.pdf",
        "mime": "application/pdf"
      }
    }
  ],
  "alternates": {
    "markdown": "/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996/index.md",
    "json": "/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996/index.json",
    "bundleManifest": "/en/publications/imf-staff-position-notes/issues/2016/12/31/the-economics-of-bank-restructuring-understanding-the-options-22996/bundle-manifest.json"
  },
  "generatedAtUtc": "2026-09-21T15:14:06.149Z"
}