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The article discusses the bad bank concept of American investment banking industry. It mentions that the concept depicts and holds the non-performing assets owned by a bank. It mentions that American investment banking firm Citigroup, which created a bad bank known as Citi Holdings to hold toxic assets and other non-performing units for disposal.

The article reports that U.S. Treasury secretary Tim Geithner has arranged for another release of Bailout 2.0, a term used for giving a loan to a company or country which faces financial bankruptcy, in the U.S. as of 2009. It mentions that bad banks need to empty their toxic assets into an aggregate bank in order to be run in partnership with private institutions.

The article focuses on the financial services firm Lehman Brothers whose executives are planning ideas to make it good bank and bad bank, and discusses how to attract big equity infusion from overseas investors.

The article announces that Terry Laughlin was appointed as head of the bad bank at Bank of America.

The article discusses the usefulness of new Troubled Asset Relief Program (TARP) of the U.S Government to purchase assets and equity from financial institutions. It reveals that the new TARP may do a lot to remove the banking industry's only problem of illiquidity. Financial experts are predicting that liabilities will exceed assets in most of banks because of insolvency.

The article informs that the U.S. bank Lehman Brothers has announced to spin off a bad bank due to the issues of long-term finance and assumes liability for the first losses as of September 2008. It informs that financial services firms Merrill Lynch and UBS made deals with financial firms Lone Star and BlackRock respectively to offload their toxic bonds. It also mentions the assumptions of first loss risks by the buyers.

The article reports that bank Citigroup Inc. has decided to sell its student loan business and 32 billion dollars in assets to Discover Financial Services and Sallie Mae Inc., as a part of its plans to focus on the core consumer banking market. Citi Holdings which had student loan business, now accounts for 20 percent of the bank's balance sheet.