Zombie bank

From MarketsWiki
Jump to navigation Jump to search



A "zombie" bank is one that is artificially kept alive by a government bailout, when it otherwise would have died (failed). [1] [2] In the strictest definition it is a bank with a market worth of less than zero.[3] The term zombie bank or zombie firm was first used to describe failing businesses propped up by the Japanese government during a period of economic stagnation in Japan in the 1990s (called "the lost decade")[4]. The strategy led to a bubble and consequent collapse, in part because the capital injections were not big enough to fix the system. [5]

References[edit]