Credit Crunch Munch

vincent--vegas

Hi There, okay, I've got a question for y'all!

With the state of the economy at the moment, banks are finding it very hard to actually pull-through without being bought out by a bigger bank, or the government...now what would happen if a loan or credit-card securing bank went bankcrupt - who takes on the loan? Does it get 'sold on to the highest bidder' or written off? Obviously the latter would be beneficial to many! Sorry if I'm just being totally nieve but I am a little confused by this one...

Thanks! Steve

tictax

It wouldn't be written off.

Think about it - when a "normal" company goes bankrupt the assets are sold to then pass onto the creditors. Loans that a bank has made are their assets so why wouldn't they be sold on to then recover some money to pay the creditors.