Zombie Bank

  • Zombie firms/companies survive on borrowing as they do not have enough profits to cover debt-servicing costs.
  • Zombie Bank is a bank that is practically insolvent but continues to exist through hiding bad loans on their balance sheet.
    • These are kept afloat to prevent panic from spreading to healthier banks.
  • Zombie banks resort to forbearance lendinge. allows a borrower to temporarily stop or suspend payments of the loan.
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