Corporate Rescue and Reorganization

Abstract

Abstract The jurisdictions under consideration provide a range of options for effectuating corporate rescue or reorganization. Some of these procedures are long-standing and applicable across the board; others are new and financial institution-specific. In England and Wales, administration has been used successfully to restructure financial institutions in the past; the bank administration procedure is new and largely untested, whereas the investment bank special administration regime (SAR) has already been applied in several cases. Germany’s brand-new pre-insolvency procedures apply to credit institutions only, but do not look very promising when it comes to the restructuring of large, systemically important financial institutions. Chapter 11 of the US Bankruptcy Code is regarded as very effective. It was put to the test when Lehman Brothers filed for bankruptcy in the autumn of 2008. Many commentators believe that it has coped well. However, there is always room for improvement and an exciting reform debate is underway.