For the banks there is no sense in pulling the pin.
If they continue to operate the banks get regular payments and a "bonus" penalty interest, so they get about 4% of debt back in profit (after the banks costs of borrowing taken into account) each year and some capital returned. In the next four years they get about 45% of the debt back and centro still owes them about 80% of current amounts that they will in due course get back with interest.
If they liquidate centro they get nothing back for a few years (when the liquidators have finished - and liquidators have no mandate to have a fire sale), then maybe 60-70% of the debt back and the rest written off.
If centro is kept afloat they get 100% capital returned (including about 45% over the next four years) and make big interest profits along the way (worth about another 50% over time) for total about 150%, if it folds they get back about 65% in maybe 4 or 5 years time. The difference is many billions. Seems a foregone conclusion to me but you never know - I may have egg on my face come September 30!!
CNP Price at posting:
13.0¢ Sentiment: Buy Disclosure: Held
