Creditors' Committee

Developments Affecting Post-Petition Interest Rates

The last few years have seen an interesting array of cases addressing issues regarding interest rates in bankruptcy cases. [1] This article provides a summary update on whether (1) the solvent-debtor exception survives in determining the appropriate post-petition rate that must be applied to unimpaired claims under a chapter 11 plan, (2) the solvent-debtor exception similarly requires the payment of makewholes, and (3) reinstated creditors are entitled to collect post-petition interest at the default rate.