Creditors' Committee

DEFINITION of 'Creditors' Committee'

A group of people who represent a company's creditors in a bankruptcy proceeding. The creditors' committee is usually further divided between secured and unsecured creditors.

BREAKING DOWN 'Creditors' Committee'

The secured creditors' committee consists of lenders that have a first claim on assets that collateralize their loans. Members within the unsecured creditors committee generally have more or less power depending on the amount they are owed. Although the court will take into account the position of the creditors' committee, the bankruptcy trustee has ultimate power in deciding what is fair to all parties.