Word: lender
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Dates: during 1980-1989
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...created in 1944 to keep order in the international monetary system. Its guiding genius, British Economist John Maynard Keynes, wanted it to be a true lender of last resort, a global central bank capable of creating its own money. His ideas were deemed too visionary, and the fund's role was limited to helping member states-45 at the beginning, 146 today-ride out balance of payments difficulties. A country in deficit could apply to the IMF for low-interest loans. In return, the IMF required the debtor government to put its economic house in order. When the deficits...
Manufacturers Hanover denied that it suddenly needed to raise cash and called the rumors "absurd." Senior Vice President James Hambelton said the bank had one of the smallest portfolios of bad loans of any lender its size...
...their four-bedroom house at the daunting 15% going rate for a conventional mortgage. But with an ARM, the computer repairman and his wife paid an initial rate of just 11⅞% on their $85,000 home. Now they wish they had never heard of ARMS. Last January their lender boosted the rate to 12½%, raising the monthly payment from $750 to $825. The sudden increase, which amounted to an extra $900 a year, forced the strapped couple, who have four children, to visit a credit counselor and to cut back on expenses like hot lunches at work...
...others, though, are concerned that some savings institutions have imprudently sold the loans to people who can ill afford them. Mortgage companies in such booming states as Florida and Texas have touted very low, so-called teaser rates that jolt upward in succeeding years of the mortgage. One Houston lender, Alpha Mortgage, offered a one-month introductory rate of 4⅞% last year. The offer was never repeated. Says Alpha President Ron Redd: "If you're not careful, borrowers will just go out and spend the difference on something else and then be in trouble when time comes...
Nonetheless, Continental Chairman David Taylor suggested last week that still more moves may be forthcoming. Conceding that "we've had some rather serious earnings problems," Taylor said the institution may have to merge with another lender and has retained the Wall Street firm Goldman, Sachs to help it find a buyer. "The candidates open to us are numbered among the top 50 banks in the world," he added. For now, Taylor gave investors the disappointing if not wholly unexpected news that Continental plans to save $20 million by omitting its next quarterly common-stock dividend...