U.K. Treasury plans ‘bad bank’ to buy toxic assets

A state owned “bad bank” to buy up tens of billions of pounds of toxic assets from high-street banks with taxpayers’ money could be set up, under plans being drawn up by the Treasury.

Gordon Brown is preparing a new multi-billion pound rescue package for the banks which is expected to be announced next week.

In his strongest hint yet that a “bad bank” is a serious option, the Prime Minister said that “action” on toxic debts, which are blamed for the failure of high-street banks to resume normal lending, is now essential.

http://ftalphaville.ft.com/blog/2009/01/16/51248/bad-bank-brewing/

Seems, bad banks are "in"...

 

The name of the newly created "bad bank" will be UBS.

 

I'd rather have the Fed keep buying the bad assets, so foreign dollar holders end up sharing some of the pain instead of taxpayers.

 

Soon to be renamed to "downing street banks".