# kaal:claim:2061166-012

**Claim.** 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.

**Type.** failure  **Support.** argued

**Holds when.**

- reorganization procedure under the German Financial Institution Reorganization Act
- where shareholders' rights are permanently impaired by the plan

**Source quote.**

> 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, page 40

**Cite as.** Christoph K. Henkel, Wulf A. Kaal, Contingent Capital in European Union Bank Restructuring (2012). SSRN: https://ssrn.com/abstract=2061166

**Verify.** sha256 of source PDF `43625ea260d0fc045e86d3435df50c9d0ca4abf8542e6085a6165be6653b4a7b` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Henkel%20and%20Kaal%20-%202012%20-%20Contingent%20Capital%20in%20European%20Union%20Bank%20Restructuring.pdf

**Failure mode.** Shareholder valuation proceedings slow bank reorganization  (family: supervisory-capacity-gap)

**Topics.** systemic-risk, corporate-governance, economics

**Keywords.** german-banking-law, shareholder-compensation, reorganization-speed, valuation

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