things will be just splufty!

If we take the announcements at face value ...

- the banks will do a debt for equity swap
- current ordinary holders have negative equity
- assets earmarked for sale have been savagely valued (mark to market)

What does the debt for equity swap mean?

Lower debt, more equity ... positive net equity for remaining holders!!

This also means - more time to unwind good assets in a reasonable market - rather than a bad market. Yet more equity value for the remaining holders.

The reorganisation of the BNB business began in early 2008. Some writedowns have already been taken - with a half year profit of $175m. This must mean that the remaining business can be profitable.

I am not saying that BNB is without risk - there is a very real probability that it could all fall apart.

However, there is a very real probability that things could turn out just splufty!!

/disclosure: Hold BNBG - No BNB