Not quite as buxom or blonde as you might think, but not bad either... Swedish economist Anders Aslund has a very helpful post over at the Peterson Institute blog:

Sweden did not nationalize its banks. It was Norway that did so, which is an alternative model. In Sweden, a temporary emergency bank authority was set up on the model of the US Federal Deposit Insurance Corporation. ... The banks were forced to write off their bad debts and transfer them to bad banks.

Sweden had no aggregator bad bank and the bad banks were not nationalized. Each big bank set up its own bad bank. ... The private bad banks, however, remained the property of the private banks from which they were removed.

Nobody traded toxic waste at the height of the crisis in Sweden. Such trade is an unnecessary complication. A bad bank is not a bank but a private equity fund, which does not need much capital or recapitalization. ...

The bad banks sold off their assets at a leisurely pace over several years to maximize their value, avoiding excessive depreciation of assets through fire sales. Any gain was to the benefit of its owners. In this way, Sweden avoided the problem of trading undervalued assets. In the end, even [the worst-off bad bank] made a small profit.

As for what remained after the bad assets were removed, Aslund says two banks were merged and run by the government (one was already government-owned); two were recapitalized by shareholders, who eventually made a profit; and the rest recovered without new capital.

--Noam Scheiber