An agreement drawn up under the auspices of the Bank of England for the event of the collapse of large companies in England. The core of the agreement is that – a bank does not collect its outstanding loans for the time being and does not press for insolvency proceedings, – the banks affected by non-performing loans to the company cooperate and coordinate all steps, and – the affected banks share any losses according to a certain system. – The background to the London proceedings is that experience shows that the banks and all parties involved are better off if the company continues and emerges from the crisis than if it goes bankrupt. – See crash, hedge funds, insolvency, intercreditor agreement, crisis burden-sharing program, reintermediation, risk capital, loss-sharing arrangement, priority rule, unconditional. – Cf. IMF: Economic Issues 31: Corporate Sector Restructuring.
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