# kaal:claim:2061166-017

**Claim.** Requiring only that consideration be commensurate with the value of transferred assets invites frequent and significant disputes over valuation, a problem compounded when the consideration consists of shares in the bridge bank, whose own value must then also be assessed.

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

**Holds when.**

- asset transfers to a bridge bank under the German Banking Act
- consideration paid in shares of the transferee entity

**Source quote.**

> However, because the required consideration must only be commensurate with the value of the transferred assets,419 there may often be significant disagreements over the issue of valuation.

**From.** Christoph K. Henkel, Wulf A. Kaal, *Contingent Capital in European Union Bank Restructuring* (2012), (b) Regulatory intervention powers and procedures, page 48

**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.** Valuation disputes over bridge bank consideration  (family: valuation-and-pricing-failure)

**Topics.** systemic-risk, economics

**Keywords.** bridge-bank, valuation, asset-transfer, german-banking-law

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