Recently, a bankruptcy filing by a Wisconsin bank holding company was held up by the New York Times’ DealBook blog as a model of prudent and, in fact, innovative management. Typically, when bank holding companies file for bankruptcy, it’s far too late to save the subsidiary banks. Holding companies generally don’t consider filing Chapter 11 until bank examiners and the Federal Deposit Insurance Corporation sweep in and take over their banks.
A Chapter 11 Bankruptcy usually allows a debtor to continue business operations while attempting to reorganize the debtors debts at the same time. This makes headlines when an organizations such as Crystal Cathedral, United Airlines, Lehman Brothers or General Motors files for Chapter 11 protection. But it is just as applicable for a corner gas station, a pizza parlor, or any other business. If the Debtor is a legitimate and operating commercial enterprise of any type, it may benefit from a Chapter 11 filing.