The German government approved the creation of a "bad" bank.

German Cabinet approved the establishment of a "bad" bank, which will accumulate problems and depreciation of assets of German banks, reports BBC News. Under the proposed scheme, the German banks will be able to exchange problem assets for government bonds, insured. In doing so, financial institutions will be obliged to pay to the annual percentage of Germany, which has not yet been determined.
The scheme of creating a "bad" bank is now under consideration by the Bundestag (German Parliament). According to the Government, the creation of a "bad" bank would make a revival on the interbank market, and consumer lending. As expected, the value of the bonds, which will be the exchange of assets will not exceed 90 percent of the value of the assets exchanged. After an exchange of problem assets will be placed in a "bad" bank for 20 years.
Over the past few months, several governments have begun discussing the idea of creating a "bad" bank. Thus, at the end of January 2009 it was reported that the committee under the direction of first vice-premier Igor Shuvalov has proposed to develop a new scheme rescue banks by transferring the problem assets on the balance of the special "bad" bank. The idea of establishing such a bank in Russia so far has not found support.
Meanwhile, in the United States the idea of creating a "bad" bond issue in January 2009. At the end of March this year, the head of the Ministry of Finance of the U.S. Timothy Gaytner announced that the government bought out the local banks' high-risk assets in the amount of Half dollars.