This is one of the key areas of our financial sector practice. We bring global expertise to help Developing Country Governments and financial authorities cope with financial distress. Our Associates are experienced in bank restructuring in developing countries. We provide advice and guidance on Bank portfolio performance and risk, can assess capital adequacy and regulatory compliance and help regulators conduct the necessary stress tests and make a determination on a case by case basis on further action. At the firm level, we help Donors and Governments design, improve and strengthen insolvency regimes, especially where the judicial processes are still in the formative stage, by helping to set up out of court processes, for example along the “London Club” lines.
In view of the current global crisis, DEA’s global expertise could provide valuable assistance not only to countries which have underdeveloped insolvency systems where the legal framework or the judicial capacity might be inadequate to handle the complexity or volume of cases that might appear, but also to countries that have the legal framework and the judicial capacity, but where the case load might become too onerous or out of court settlements might yield other benefits.
Specifically some examples of the DEA offering for informal insolvency proceedings, include assistance for the following: (i) Design of a clearly defined process that the parties would follow along with a specified timetable; (ii) Standardized forms of contract that the parties could sign after they have negotiated the variables; (iii) Suggested amendments to statutes and regulations, to provide a system of incentives and penalties to motivate the parties to remain with the informal process to their better interest; (iv) Institutional design and functional support to minimize the involvement of government in the informal process while helping it to provide the regulatory oversight needed and (v) communications programs to publicize and create demand for the informal process.