Bad bank is a term for a financial institution created to hold non-performing assets owned by a state guaranteed bank.
Due to troubling and non-performing bad assets the bank sector yet is at risk to lose stability.
The company had $2 billion in non-performing assets on Sept. 30, or 15.7 percent of total assets.
The bank has sold off $494 million, or 27 percent, of its non-performing assets in the past six months.
The gross non-performing assets of the bank amount to 65.8% of the total loans and advances.
These non-performing assets were corporate and property-related loans made by the Bank.
At the time of the bailout, non-performing assets exceeded 30% of the loan book.
Once the borrower has failed to make interest or principal payments for 90 days the loan is considered to be a non-performing asset.
These sales help a bank reduce non-performing assets or manage their balance sheet.
At the time of sale the bank was considered a non-performing asset having reported a loss of $123.3M in 1991.