Q&A: INSOL President
ing to take the pain of a haircut on a full-blooded restructuring. This has prompted more use of so- called ‘amends and extends’ whereby the maturity of the debt is pushed out and the covenants are altered. I expect this trend to continue to an extent.
How can we change the old maxim that corporate groups live globally but die nationally? Many have looked long and hard at corporate
groups, and nobody as yet has come up with a simple solution that would always work and is not potentially unfair to some stakeholders. If a fair solution were to be found it would obviously be a very good thing. But until then, and absent all group companies
having the same CoMI, we have to accept the fact that different companies are going to have differ- ent regimes, and different creditors will have dif- ferent legitimate expectations as to what the out- come will be under local law. That would be less fraught if all the regimes were of an equal standard and the courts were equally responsive but until then I fear we are just going to have to grapple with the problems thrown at us.
left disappointed by the recent UK Supreme Court decision in Rubin and New Cap
“ ” I have been
Where are we headed in terms of bank crisis resolution? Bank resolution is a huge project. The ideal would be to have in place complete recognition and enforcement resolution procedures flowing from the CoMI of the bank. But the truth is banks are just so politically important that it is going to be hard to achieve. Certainly, the politicians in one jurisdiction can be forgiven for being a bit reluc- tant to cede total control over the fate of a bank branch to somebody in a different country with- out adequate safeguards in place. Those will have to be negotiated. It is hoped that in due course all the national
regulatory authorities relevant to any particular institution will know how that financial institu- tion is made up, and have a checklist in place as to what would need to be done over a weekend if a problem were to surface on a Friday – so a solu- tion blueprint, if you like. That is an admirable goal, but I think we have to accept it will take years to achieve. However, that is no reason not to try. We have to accept that bank resolution is cru- cial. INSOL through the PSTF has recommended this to the G20 as a focus although I rather suspect we are not the only ones!
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IFLR|RESTRUCTURING & INSOLVENCY 011
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