The German provision allowing appropriate compensation of shareholders whose rights are impaired can defeat the statute's own purpose, because time is of the essence in bank reorganization and the appointment of a court-appointed expert to value shareholder claims may significantly slow the procedure.
Source quote, verbatim
Time is of the essence in any bank reorganization and the appointment of an expert may significantly slow down the procedure, making it less effective.
From
Christoph K. Henkel, Wulf A. Kaal, Contingent Capital in European Union Bank Restructuring (2012), (ii) Reorganization Procedure, p. 40 https://ssrn.com/abstract=2061166 · source PDF
Cite as
Christoph K. Henkel, Wulf A. Kaal, Contingent Capital in European Union Bank Restructuring (2012). SSRN: https://ssrn.com/abstract=2061166
Holds when
reorganization procedure under the German Financial Institution Reorganization Act
where shareholders' rights are permanently impaired by the plan
Classification
failuresupport: arguedfailure: Shareholder valuation proceedings slow bank reorganizationfamily: supervisory-capacity-gapsystemic-riskcorporate-governanceeconomics
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