BankThink: Flexibility in Failures

In an online survey, more than half of respondents (57%) said the Federal Deposit Insurance Corp. should have no leeway in how it treats unsecured creditors of big firms that fail. Instead, all creditors should be treated the same as they would in a bankruptcy.

Another 24% of respondents said the agency needs the flexibility to treat creditors differently in order to maximize a company's value, and 19% said that, though unsecured creditors should mostly be treated the same, some leeway is needed.

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