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Pre-emptive sovereign debt restructuring and holdout litigation

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Authors and Corporations: Anand, Kartik (Author), Gai, Prasanna (Author)
Other Authors: Gai, Prasanna 1969- [Author]
Type of Resource: E-Book
Language: English
published:
Frankfurt am Main Deutsche Bundesbank [2018]
Series: Deutsche Bundesbank: Discussion paper ; no 2018, 21
Subjects:
Internationale Staatsschulden
Insolvenz
Umschuldung
Gläubiger
Schuldenmanagement
Internationale Staatsschulden
Insolvenz
Umschuldung
Gläubiger
Schuldenmanagement
Source: Verbunddaten SWB
Lizenzfreie Online-Ressourcen
ISBN: 9783957294692
Description
Summary: We offer an analytical framework for studying "pre-emptive" debt exchanges. Countries can tailor a sovereign bankruptcy framework by choosing provisions (or "haircuts") ex ante, but must contend with the market discipline of holdout litigation ex post. Secondary markets play a role in shaping the holdout costs facing the sovereign, and our results suggest that it is optimal to prioritise the rights of holdout creditors during litigation so that they are always paid in full. We clarify how macroeconomic and legal factors influence the choice of haircut. Our model contributes to the debate on sovereign debt restructuring by formalizing Bolton and Skeel's (2004) notion of a "Designer SDRM".
Physical Description: 1 Online-Ressource (circa 24 Seiten); Illustrationen
ISBN: 9783957294692