Etymology

bad bank

Today it means: A bank created to specialize in the ownership of defaulted loans and their collection. Full definition →

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The story

Possibly derived from a usage by Walter Bagehot in Lombard Street: "The cardinal maxim is, that any aid to a present bad bank is the surest mode of preventing the establishment of a future good bank."

Etymology from Wiktionary, CC BY-SA 4.0.