Bank-led restructuring in Poland : bankruptcy and its alternatives

Poland's Enterprise and Bank Restructuring Program, adopted by Parliament in 1993, provided for the resolution of problem loans through workouts, liquidation, or loan sales. In this report, the authors examine how formal"exit"processes (the movement of labor and assets out of one organization into another or into unemployment) work in Poland. They examine three exit processes - court conciliation, bankruptcy, and the liquidation of state enterprises - and touch briefly on the alternatives of debt repayment and the sale of debt. They also examine how Polish firms slated for downsizing or closure differ from those selected for survival. The most problematic of the three exit processes is the liquidation of state enterprises, which is almost entirely controlled by debtors. It is much slower than bankruptcy and should be strictly limited to solvent firms or eliminated altogether, because it invites abuse. Poland has neglected such traditional processes as bankruptcy and workout, partly because of its emphasis on bank conciliation. Now that bank conciliation has expired as an option, Poland should shift its energies to improving traditional, broadly applicable exit and workout processes rather than add new ones for selected types of firms. Special alternatives for selected firms tend to lead those firms to expect lenient treatment and thereby create a moral hazard that could stall further restructuring.International Terrorism&Counterterrorism,Banks&Banking Reform,Strategic Debt Management,Payment Systems&Infrastructure,Economic Theory&Research,Banks&Banking Reform,Strategic Debt Management,Financial Intermediation,Economic Theory&Research,Municipal Financial Management

Bank-led restructuring in Poland : an empirical look at the bank conciliation process

Since 1992, Poland has been considered a model of commercial banking reform among transition economies. Its Enterprise and Bank Restructuring Program (EBRP) tried to force state-owned commercial banks to build institutional capacity and to resolve problem loans through workouts, liquidation, loan sales, or pay back. The authors reviewed the process and initial outcomes of the bank-led conciliation process. A companion paper looks at experience with the other resolution paths under the EBRP. The outcome is decidedly mixed. The EBRP forced banks to confront their problems, helped them build institutional capacity, and furthered the task of weeding out and closing unviable firms. Despite these strengths, the data suggest that the bank-led conciliation process has had limited power to promote firm restructuring or privatization. The agreements themselves included few tangible requirements for operational or management change. The first two years of implementation saw a slowdown in the layoffs rate, a decline in average operating profitability, and little real privatization. The main impact of conciliation appears to have been to reduce debt service. Weaker banks tended to be more lenient, swapping more debt for equity, and had greater difficulty forecasting future enterprise performance. The EBRP was a good start, but continued work is needed to build strong banks that can impose effective corporate governance on enterprises that need to restructure.Financial Intermediation,Banks&Banking Reform,Payment Systems&Infrastructure,Financial Crisis Management&Restructuring,Municipal Financial Management,Banks&Banking Reform,Financial Crisis Management&Restructuring,Financial Intermediation,Municipal Financial Management,Strategic Debt Management

IgG glycosylation and DNA methylation are interconnected with smoking

Background: Glycosylation is one of the most common post-translation modifications with large influences on protein structure and function. The effector function of immunoglobulin G (IgG) alters between pro- and anti-inflammatory, based on its glycosylation. IgG glycan synthesis is highly complex and dynamic. Methods: With the use of two different analytical methods for assessing IgG glycosylation, we aim to elucidate the link between DNA methylation and glycosylation of IgG by means of epigenome-wide association studies. In total, 3000 individuals from 4 cohorts were analyzed. Results: The overlap of the results from the two glycan measurement panels yielded DNA methylation of 7 CpG-sites on 5 genomic locations to be associated with IgG glycosylation: cg25189904 (chr.1, GNG12); cg05951221, cg21566642 and cg01940273 (chr.2, ALPPL2); cg05575921 (chr.5, AHRR); cg06126421 (6p21.33); and cg03636183 (chr.19, F2RL3). Mediation analyses with respect to smoking revealed that the effect of smoking on IgG glycosylation may be at least partially mediated via DNA methylation levels at these 7 CpG-sites. Conclusion: Our results suggest the presence of an indirect link between DNA methylation and IgG glycosylation that may in part capture environmental exposures. General significance: An epigenome-wide analysis conducted in four population-based cohorts revealed an association between DNA methylation and IgG glycosylation patterns. Presumably, DNA methylation mediates the effect of smoking on IgG glycosylation

The importance of specialist treatment, treatment satisfaction and diabetes education for the compliance of subjects with type 2 diabetes - results from a population-based survey.

AIMS: This study aims to investigate the degree to which subjects with type 2 diabetes comply with treatment recommendations concerning diet, physical exercise and self-care, the consistency of compliance across different treatment areas, and the association of compliance with individual characteristics of patients and their medical treatment. METHODS: The sample consists of 345 type 2 diabetes patients who had been drawn from two population-based surveys (MONICA) and from a myocardial infarction registry in Southern Germany, and who have participated in a survey in 1997/98. Data were collected by interviews, questionnaires and medical exams. Pearson correlation and logistic regression analysis were applied to test the relationships. A compliance score was established by adding up the components of the treatment regimen. RESULTS: Only one fifth of the subjects with type 2 diabetes showed good compliance in terms of the applied score. Compliance was highest in weight measuring and foot care, and poorest in following exercise recommendations, glucose testing, and recording the results. Overall, weak correlations were found between the components of the treatment regimen. Participation in diabetes education, regular consultation of physicians specialized in diabetes care, age (<70 years), and satisfaction with treatment were all associated with better compliance. CONCLUSIONS: Correlation between the different components of compliance behaviour was low, indicating that compliance should not be measured by one component only. As compliance with the treatment recommendations was poor, education programs for type 2 diabetic subjects should be propagated and the cooperation with diabetes specialists should be promoted

Measurement of antibodies to avian influenza virus A(H7N7) in humans by hemagglutination inhibition test.

During the epizootic of highly pathogenic avian influenza A(H7N7) in 2003 in The Netherlands, RT-PCR and culture confirmed infection was detected in 89 persons who were ill. A modified hemagglutination inhibition (HI) test using horse erythrocytes and 2 hemagglutinating units of virus was applied to assess retrospectively the extent of human (subclinical) infection. Validation of the HI-test with sera from 34 RT-PCR and culture confirmed A(H7) infected persons and sera from 100 persons from a human influenza vaccine trial in autumn 2002 showed that this HI-test had a sensitivity of 85% and a specificity of 100% when using a cut-off titer of > or =10. Using this cut-off value, A(H7) specific antibodies were detected in 49% of 508 persons exposed to poultry and in 64% of 63 persons exposed to A(H7) infected persons. Correlation of seropositivity with the occurrence of eye symptoms in exposed persons who had not received antiviral prophylaxis and of reduced seropositivity with taking antiviral prophylaxis provided further evidence that the A(H7) HI antibody titers were real. In conclusion, by applying an HI-test using horse erythrocytes human antibodies against the avian A(H7N7) virus were detected with high sensitivity and specificity in an unexpectedly high proportion of exposed persons

High probability of avian influenza virus (H7N7) transmission from poultry to humans active in disease control on infected farms

An epizootic of avian influenza (H7N7) caused a large number of human infections in The Netherlands in 2003. We used data from this epizootic to estimate infection probabilities for persons involved in disease control on infected farms. Analyses were based on databases containing information on the infected farms, person-visits to these farms, and exposure variables (number of birds present, housing type, poultry type, depopulation method, period during epizootic). Case definition was based on self-reported conjunctivitis and positive response to hemagglutination inhibition assay. A high infection probability was associated with clinical inspection of poultry in the area surrounding infected flocks (7.6%; 95% confidence interval [CI], 1.4%-18.9%) and active culling during depopulation (6.2%; 95% CI, 3.7%-9.6%). Low probabilities were estimated for management of biosecurity (0.0%; 95% CI, 0.0%-1.0%) and cleaning assistance during depopulation (0.0%; 95% CI, 0.0%-9.2%). No significant association was observed between the probability of infection and the exposure variables

High probability of avian influenza virus (H7N7) transmission from poultry to humans active in disease control on infected farms

An epizootic of avian influenza (H7N7) caused a large number of human infections in The Netherlands in 2003. We used data from this epizootic to estimate infection probabilities for persons involved in disease control on infected farms. Analyses were based on databases containing information on the infected farms, person-visits to these farms, and exposure variables (number of birds present, housing type, poultry type, depopulation method, period during epizootic). Case definition was based on self-reported conjunctivitis and positive response to hemagglutination inhibition assay. A high infection probability was associated with clinical inspection of poultry in the area surrounding infected flocks (7.6%; 95% confidence interval [CI], 1.4%-18.9%) and active culling during depopulation (6.2%; 95% CI, 3.7%-9.6%). Low probabilities were estimated for management of biosecurity (0.0%; 95% CI, 0.0%-1.0%) and cleaning assistance during depopulation (0.0%; 95% CI, 0.0%-9.2%). No significant association was observed between the probability of infection and the exposure variables