Given their analysis of the breakdown of the repo market, Gorton and Metrick’s answer might be self-evident: The G-M proposal aims to solve the information problems that increased the risk from maturity transformation associated with ABS repo funding.
This process will leave out bad managers as well as bad and improper controlling owners from the post-restructuring banking sector of Indonesia. It has been on the basis of the principles I cited earlier that we run our bank recapitalization program to recapitalize those banks that we believe have a viable future together with the decision to liquidate those banks that were not viable.