Andorra to create 'bad bank' to group BPA toxic assets

Andorra will create a 'bad bank' to group the assets of Banca Privada d'Andorra (BPA) linked to illicit activity, it said late on Thursday, as the principality battles to rebuild the reputation of its banking system. Andorra, a small mountainous state whose economy relies heavily on financial services, took control of BPA this month after the U.S. Department of the Treasury said it was a channel for laundering the profits of international criminal gangs. "We are setting up a good bank/bad bank scheme," he said, adding that next week the state would pass bank restructuring legislation to speed up the resolution of the BPA crisis. The scheme would help the state analyze different outcomes for BPA, which could including selling assets, a total or partial return to operations, or a liquidation, he said.

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