John Lamidey, chief executive of the Consumer Financial Association which represents the eight largest payday loan lenders, said most long-term debt was on credit cards and bank overdrafts and he advised anyone with long-term debt to go to Citizens Advice (CAB).

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In fact, long-term debtholders who have debt claims against the bad bank and equity claims against the good bank will be better off under this plan than if the bank were liquidated or continued to operate as one bank.

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Within two years, the central bank will own 20% of the long-term debt the Japanese government has sold at auction, up from a little over 12% currently, according to some estimates.

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Another rapidly growing country with a decentralized government, Brazil has financed nearly every renewable energy project through the National Social Economic Development Bank (BNDES) with low-cost and long-term debt financing.

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It is buying leasing assets, distressed debt and has also shown an interest in Long-Term Credit Bank.

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In support of Abenomics, the Bank of Japan this past Wednesday affirmed its own policies to buy long-term debt and securities.

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Separately, the Bank of England said it expects existing banks to bolster their balance sheets with more capital and long-term debt in the second quarter.

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