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Zombie Bank

Is a financial institution that has an economic net worth less than zero but continues to operate because its ability to repay its debts is shored up by implicit or explicit government credit support. As the net worth of a bank is defined as the value of a bank's assets minus the value of a bank's liabilites. These types of bank's that are kept as an ongoing regulatory concern must have a negative net worth so effectively are banks that should be 'dead' in terms of solvency but are kept running by the regulators.

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