Book: Resolution of Financial Distress

Time to dust off the East Asia crisis writings. In 2001, I edited a book (with Stijn Claessens and Ashoka Mody, both IMF) on what we learned in the 1998-2000 dealings with financial distress. I had nearly forgotten about this work -- it was rarely cited after it got published. Now you may want to take a look.

The overview is a good start -- it summarizes the findings on insolvency regimes; dealing with systemic distress (asset-managements companies and the like); corporate restructuring; and injecting government equity into troubled financial institutions.

Other good reads are Bankruptcy Laws: Some Basic Principles, by Joseph Stiglitz; Asset Management Companies, by Daniela Klingebiel; and Bankruptcy Procedures in Countries Undergoing Financial Distress, by Michelle White.

A parting thought found on page one of the book: "Broadly in a systemic crisis, the government's role lies, first, in defining rules that would lead to efficient private restructuring efforts and, second, in providing direct assistance where the private initiatives prove insufficient to resolve distress at acceptable output losses."