BMGT 445 lecture 10

BMGT 445 lecture 10 - BMGT445 ProfessorEthanCohenCole

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Click to edit Master subtitle style 3/1/11 BMGT 445 Professor Ethan Cohen-Cole Lecture 10
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3/1/11 Sovereign Risk
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3/1/11 Introduction In 1970s: Expansion of loans to Eastern bloc, Latin America and other LDCs. Beginning of 1980s: Debt moratoria announced by Brazil and Mexico. Increased loan loss reserves Citicorp set aside additional $3 billion in reserves for example
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3/1/11 Introduction (continued) Late 1980s and early 1990s: Expanding investments in emerging markets. Peso devaluation and subsequent restructuring U.S. loan guarantees under Clinton Administration More recently: Asian and Russian crises. Turkey and Argentina Argentina’s focus on fiscal surplus Economic growth in the 2000s and reduction in external debt.
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Were Lessons Learned? U.S. FIs limited exposure to in Asia during mid and late 1990s Not all: Chase Manhattan Corp. emerging market losses $150 million to $200 million range Poor earnings by J.P. Morgan. Losses in Russia with payoffs of 5 cents on the
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This note was uploaded on 02/28/2011 for the course BMGT 445 taught by Professor Malmquist during the Spring '09 term at Maryland.

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BMGT 445 lecture 10 - BMGT445 ProfessorEthanCohenCole

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