Magazine article American Banker

U.S. Banks Cut Credit to Asia but Boost It in Other Emerging Areas

Magazine article American Banker

U.S. Banks Cut Credit to Asia but Boost It in Other Emerging Areas

Article excerpt

U.S. banks have slashed their exposure to Asian emerging markets this year, while upping the ante in other developing regions, according to a report.

Data compiled by Brown Brothers, Harriman & Co., a New York investment bank, show that cross-border exposure among U.S. banks in Asian emerging market countries excluding Taiwan was $41.3 billion at the end of the first quarter, a 22% drop from the fourth quarter of 1997.

But cross-border lending and other credits extended to Latin America rose 3%, to $89.3 billion, at March 31.

Cross-border exposure to southern and Eastern Europe increased 16%, to $15.3 billion. Exposure to Africa jumped 11%, to $7.5 billion.

Total cross-border lending to emerging market countries fell, however, by 4%, to $163.4 billion.

The figures are based on information supplied by the Federal Financial Institutions Examination Council, a regulatory agency that tracks credit extended to foreign borrowers by U.S. banks.

They do not include loans and other credits extended by U.S. banks from overseas offices. Including both cross-border and local credits, U.S. banks had $247.4 billion in exposure to emerging markets as of March 31, just slightly more than the $247.1 billion as of yearend 1997.

As of March 31, six money-center banks-BankAmerica Corp., Bankers Trust Corp., Chase Manhattan Corp., Citicorp, First Chicago Corp., and J.P. Morgan & Co.-accounted for $192.4 billion in cross-border and local-country exposure in Asia. …

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