Bad-bank definition

(banking, economics) A bank created to specialize in the ownership of defaulted loans and their collection.
noun
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Other Word Forms

Noun

Singular:
bad-bank
Plural:
bad-banks

Origin of bad-bank

  • Possibly derived from a usage by Walter Bagehot in Lombard Street: "The cardinal maxim is, that any aid to a present bad bank is the surest mode of preventing the establishment of a future good bank."

    From Wiktionary