Bankruptcy Blogs

By Shawn K. Watts 

The United States Bankruptcy Court for the District of Delaware (the “Court”) recently upheld a $23.7 million make-whole payment (the “Make-Whole Payment”) in In re School Specialty (Case No. 13-10125), denying the assertion by the Official Committee of Unsecured Creditors (the “Committee”) that the fee is unenforceable under the United States Bankruptcy Code and applicable state law.

Receiving Wide Coverage ...

Basel: Tacitly acknowledging that risk-based capital measures are susceptible to manipulation, the Basel Committee announced a supplementary, simple 3% equity-to-assets requirement that banks worldwide will have to achieve by 2018. Disclosures of leverage ratios under the new formula are to start in 2015. Investment banks will have to count derivatives on a gross basis, rather than netting out collateral or offsetting trades. This will make the U.S. firms look more leveraged than...

Institutions need to realize that, given the relative health of their asset portfolios and the current regulatory environment, valuations and deal prices will be below historical averages.

Criminals will always find new ways to steal money. Banks still need a realistic timetable from the card networks to upgrade to chip and PIN.

Banks and regulators have proposed bail-in mechanisms for capital plans. Exposing creditors to losses could help protect taxpayers and depositors, but is long-term debt an adequate substitute for equity?