Signs of an Upturn?
The Nashville Post has run a piece noting that small area lenders had a good second quarter and concluding that that is a sign of an upturn in the economy. http://bit.ly/drF9uM (subscription required).
I agree with the conclusion that there is more lending being done by the area’s smaller banks. Some of these institutions are about the only place in town for capital these days. Without them, it would be really tough to find money. Whether this is a sign of an upturn, I have my doubts.
By When Is a Guaranty Limited and When Is It Unconditional?
Guaranties generally come in two flavors: limited and unconditional. At the outset of a loan, one of the topics for negotiation is the guaranty. First, will there be a guaranty? Second, if there is a guaranty, will it be unconditional and unlimited or will it be limited in some way? A recent case reminds us that even if a guaranty does not have a specific dollar amount as a limiting factor, it may not necessarily be interpreted as unlimited and unconditional.
Trouble in Commercial Loans?
In the mainstream media, there continues to be mixed messages about the state of the economy. However, most experts would agree that there is a massive amount of troubled commercial loans that need to be worked through before there can be real improvement in the economy. For example, currently there is approximately $130 billion in commercial loan delinquencies — compared to under $20 billion in delinquencies in 2006. For more information about the scope of these woes, check out the February report from the Congressional Oversight Panel, or this blog post about the February report. What does it all mean for Nashville though?
