zombie bank

noun

: a bank that continues to operate despite having liabilities in excess of its assets : an insolvent bank kept in operation especially by government intervention

“Zombie banks” was the term for Japanese financial institutions propped up by government in the 1990s despite their basic insolvency after a real-estate bubble.—

Rich Lowry, The Oregonian (Portland, Oregon), 14 Feb. 2009

We have zombie banks that are weighed down because their liabilities exceed their assets. Without a precise mechanism for addressing toxic assets, it will be difficult to increase lending.—

John Kerry, quoted in New York Times, 11 Feb. 2009