Financial insolvency is unlikely

Professional Adviser
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Framlington's peirson believes financial companies are not facing bankruptcy in the traditional sense of the word

ichard Peirson, manager of the Framlington Financial fund, believes there is little risk of a major collapse of a quoted financial company, despite severe insolvency issues. While insolvency problems among life companies are hitting the headlines, Peirson said these companies are not insolvent in the traditional banking sense. 'A traditional company goes bankrupt when its liabilities exceed its assets. All we are talking about here is the traditional, very significant cushion of surplus assets these companies have been expected to maintain by the regulators ' those cushions have been e...

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