Ernst & Young Examines Distressed Debt

Ernst & Young recently conducted a distressed debt survey to determine who will be the most active direct sellers of non-performing loan portfolios.  The results are interesting.

• 36 percent responded it will be regional banks and thrifts

• 32 percent responded it will be money center banks

• 13 percent responded it will be the United States government

• 11 percent responded it will be insurance companies

• 8 percent had no opinion

With pressure on banks to de-leverage and raise their book capital ratios, it is not surprising that they ranked first.  Time will tell.