bailout


Also found in: Dictionary, Thesaurus, Medical, Legal, Encyclopedia, Wikipedia.
Related to bailout: austerity

Bailout

A capital infusion offered to a business with a national or multi-national footprint that is in danger of bankruptcy, insolvency, or total liquidation.  Financial aid can be provided in the form of debt or equity offerings, cash contributions, or some form of loan or line of credit, and is often accompanied by greater government oversight and regulation.  The failure of a business that employs thousands or plays an influential role in the economy potentially can send shock waves throughout the entire economy, including other industries. The credit crisis that began in 2007 created numerous failures around the world, which resulted in a large number of government-sponsored bailouts in almost every industry across the globe. See: Conservator, Conservatorship.

Bail Out

To give money to a company so that it avoids bankruptcy and is able to continue operations. Generally speaking, the term often refers to a government bailing out a private corporation. A bailout may take the form of a direct transfer of capital, or it may occur indirectly through low or no interest loans and subsidies. For example, in September of 2008 the insurance conglomerate AIG found itself in dire straits. The Federal Reserve bailed it out by extending $85 billion (and eventually $182 billion) in credit to the company. Proponents of bailouts say that they keep an economy afloat when an industry thought too big to fail otherwise would collapse. Critics contend that bailouts are inefficient and that non-competitive companies ought to fail. See also: Cash for clunkers.

bailout

The financial rescue of a faltering business or other organization. Government guarantees for loans made to Chrysler Corporation constituted a bailout.
References in periodicals archive ?
Athens wants to conclude the first bailout review and recapitalise its banks as soon as possible to launch talks with euro zone governments on debt relief, hoping to lure back investors and eventually regain market access, leftist Prime Minister Alexis Tsipras told lawmakers on Saturday.
The bailout was approved thanks to support from opposition parties.
Athens reached an agreement to reopen bailout talks with its international creditors on July 13.
The German parliament's vote capped a week in which the proposed bailout agreed by eurozone leaders on Monday has cleared a string of hurdles.
On Sunday, more than 61 percent of Greeks voted against a new bailout plan proposed by the lenders that envisaged unpopular austerity measures such as pension cuts and tax increases in exchange for another loan.
The IMF said without a deal that would disburse funds from the bailout without 12 months of financing,
In the light of above mentioned government bailout package decided by federal government, PSM Management has re-organized the maintenance, operational and production strategies to get maximum benefit from the bailout package within minimum possible period , the spokesman said.
This comes after Cyprus was offered a radical bailout from the EU last week.
Tuesday the Cypriot parliament rejected an earlier bailout plan, which included the imposition of a one-off tax of 6.
The frontrunner in the election runoff for a new president this weekend said on Thursday he has been in touch with governments and unspecified funds for a bridge loan to ensure the island nation does not run out of cash before it secures an international bailout.
Speaking in front of the National Assembly's Health and Social Care Committee, she said: "It is absolutely not a bailout at all.
Despite a recent agreement by the Euro group and the IMF on releasing further assistance for Greece under its bailout programme, the outlook for Euro zone economies remains weak and the region's sovereign debt crisis is likely to stay with us for a number of years, according to QNB Group.