Preparing for the worst;Betting that bad loans will become more common, banks are beefing up their workout staffs to boost collections and help troubled borrowers.

Crain's Detroit Business, May, 2000 by Roush, Matt

Apparently anticipating an economic slowdown, Detroit-area banks and finance companies are beefing up their ``workout'' departments that handle troubled loans. ``The bigger ones definitely have,'' said Richard Gorges, president of Troy turnaround consultants Richard Gorges Associates Inc. ``And now I'm starting to see it even in the smaller banks and finance companies.

One finance company I deal with had three loans go sour in the past week.'' Lawrence Gardner, president of another Troy management consulting firm, Lawrence Gardner Associates, said he's aware of one local bank that has boosted its local turnaround staff from seven officers to 11. Several banks have also sharply boosted the amounts they set aside for possible future problem loans. Included...

Read the rest of this article with a Free Trial at HighBeam Research.

Premium Content Partnership | HighBeam Research provides an in-depth online archive library of reference works.