Another struggling SME:
Trump’s Company Seeks to Ease Financial Crunch as Coronavirus Takes Toll
As companies nationwide look for relief, the Trump Organization has talked with Deutsche Bank and a Florida county about delaying payments on some loans and other obligations.
https://www.nytimes.com/2020/04/02/business/economy/coronavirus-trump-company-finances.html
President Trump’s family company is among those looking for help.
With some of its golf courses and hotels closed amid the economic lockdown, the Trump Organization has been exploring whether it can delay payments on some of its loans and other financial obligations, according to people familiar with the matter and documents reviewed by The New York Times.
Representatives of Mr. Trump’s company have recently spoken with Deutsche Bank, the president’s largest creditor, about the possibility of postponing payments on at least some of its loans from the bank.
Other companies may be able to tap into a $500 billion rescue fund that will be administered by the Treasury Department. But the economic bailout package, which Mr. Trump signed into law last week, specifically barred the president and his family from access to that money.
Deutsche Bank has lent Mr. Trump and his companies about $2 billion since 1998, the only mainstream financial institution consistently willing to do business with Mr. Trump and his companies. At the time he became president, Mr. Trump owed the bank about $350 million, including on loans to buy and renovate the Doral golf resort near Miami and to develop a luxury hotel in the Old Post Office building in Washington.
Both properties are suffering in the economic shutdown. In response to Miami-Dade County’s rules, the Doral resort has ceased all operations, while the Washington hotel continues to operate, albeit with few guests and with its restaurant and bar closed. The Trump Organization rents the Washington property from the federal government, and the company had been soliciting bids from potential buyers for the lease, a process that is now on hold,
The Washington Post reported.
Mr. Trump received the loans for those properties, as well as another related to his Chicago skyscraper, from 2012 to 2015. Because of his history of defaults and bankruptcies, Deutsche Bank insisted that Mr. Trump provide personal guarantees on those loans, meaning that the bank has recourse to his personal assets if he were to stop paying back the money.
Ever since Mr. Trump’s election, Deutsche Bank executives have been fretting about what would happen if he were to default, according to bank officials. Seizing the president’s personal assets would be an unattractive proposition. But opting not to collect on the loans would be the equivalent of an enormous financial gift to Mr. Trump, whose administration wields enormous power over the bank. Deutsche Bank’s operations in the United States are supervised by federal regulators, and the Justice Department has been conducting
a criminal investigation of the bank.
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