Banks Warned By Feds Not To Give "DOOMERS" Loansgreenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
NY Fed's McDonough warns banks against Y2K fears NEW YORK, Nov 17 (Reuters) - New York Federal Reserve Bank President William McDonough warned banks on Wednesday to be wary of extending huge loans to customers who are unreasonably fearful of year-end computer problems.
With roughly six weeks to go before the century turns, McDonough urged banks to exercise prudence in meeting customers' reasonable needs.
``By reasonable needs, I have in mind that banks should think twice about huge demands based on what seems to be customers' excessive concern about Y2K,'' he said in a speech to the Foreign Policy Association's conference on Global Capital Markets.
But he added banks should not scrimp on credit either. Rather he said they should ``grant appropriate credit for realistic needs, even if this involves somewhat greater use of their own balance sheets than would usually be the case.''
To help meet any extraordinary demands for credit, the Fed has created special liquidity facilities that make it easier for banks to obtain extra funds and thus lend money to their customers around the year end.
McDonough said the next several weeks will be ``a challenging period'' for both the public and private sector. But he expressed confidence that banks and their supervisory agencies can be successful in handling the transition into the 21st century.
-- LOON (email@example.com), November 17, 1999
This is one of the dumbest things I've read yet. ALL banks determine credit worthyness the same way: history and the ability to repay. Are they going to start interviewing people to determine if their 'beliefs' line up with the pollies?
-- Y2Kook (firstname.lastname@example.org), November 17, 1999.
I guess the suburbanite isn't going to receive mortgage financing for the countryside trailer on the acre lot with its well and generators. Only the native down home folk already living in the area.
-- Paula (email@example.com), November 17, 1999.
You mean I'm part of a minority now? Neat! Where's all my free stuff?
-- I'm Here, I'm There (I'm Everywhere@so.beware), November 17, 1999.
Get the SBA Y2K loan...for preparing your business...
-- Mad Monk (firstname.lastname@example.org), November 17, 1999.
Tee hee hee. Individuals who want to prep are WACKOS so don't loan to them. But businesses who want to prep are responsible and prudent, right? What about a small family business? Wacko or prudent? Tee. Hee. Hee.
-- Colin MacDonald (email@example.com), November 18, 1999.