AI
Monday, July 14, 2008 9:41:51 PM
Email from friend...
... A customer came into the bank last week. He has 5 other projects financed via M&I. All are going very slow, but are not past due, nor have they reached the maturity date. M&I called them into the Bank and offered they a “buyout”, whereby the builder pays off the M&I loan(s) at 60% of the loan balance. M&I is desperate for liquidity, and is making this offer to several local builders and residential developers. Can you imagine . . . the builder has $28,000,000 in loan balances, and M&I will take only $17 million as a payoff if they can refi/payoff the loans quickly. My customer just eliminated $9 million of debt and added $9 million in equity to their company . . . assuming they can refi the loans....
... A customer came into the bank last week. He has 5 other projects financed via M&I. All are going very slow, but are not past due, nor have they reached the maturity date. M&I called them into the Bank and offered they a “buyout”, whereby the builder pays off the M&I loan(s) at 60% of the loan balance. M&I is desperate for liquidity, and is making this offer to several local builders and residential developers. Can you imagine . . . the builder has $28,000,000 in loan balances, and M&I will take only $17 million as a payoff if they can refi/payoff the loans quickly. My customer just eliminated $9 million of debt and added $9 million in equity to their company . . . assuming they can refi the loans....
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