No sniggers, please: Barclays is planning to set up a "bad bank" to hold the junk it has accumulated in recent years - complex derivative products, underperforming ventures abroad and loans and so on. You won't see an advert for a bad bank on the telly, but these dustbins of the financial world lie scattered down the rancid back alleys of British banking.
Bad banks are where the mistakes of the past are parked, in the hope that one day they can be offloaded - at a huge discount, in the City's equivalent of a yard sale. But before we scoff, the biggest bad bank is (of course) in our hands. It hasn't the snappiest of names - it's called UK Asset Resolution - and is made up of the rubbish bits of Northern Rock and Bradford & Bingley. It has nearly half a million customers and loans worth pounds 64bn. It even has the job of guaranteeing all those mortgages under the controversial Help to Buy scheme.
But when Barclays reveals its bad bank next week, there will be no talk of toxic assets. Instead, it will be how the bank has carried out a "strategic review" aimed at "streamlining" the business to dispose of "non-core portfolios". Give that banker a bonus!
Britain is not alone in having bad banks. Spain's banking system is littered with the "assets" of bankrupt developers, while Germany'sErste Abwicklungsanstalt and others too tongue-twisting to mention hold nearly euros 200bn-worth of dud loans. The worst are the Irish, whose National Asset Management Agency (Nama) holds the rubble of that country's extraordinary boom and bust.
But you can always find some jewels among the junk. London's pounds 600-a-night Claridges Hotel (one time home to Gordon Ramsay) fell into Nama (don't ask how), but was soon snapped up by Telegraph owners the Barclay brothers in a deal worth pounds 695m. Clearly, bad banks aren't bad for everyone.
The biggest bad bank, UK Asset Resolution, has loans worth . . .