Of all the troubles threatening American bankers, none is more controversial or potentially explosive than their overseas loans. Foreign borrowers, mostly governments and companies, owe U.S. banks about $350 billion. The most dangerous loans are to such economically ailing Latin American nations as Mexico, Brazil and Argentina, which collectively owe U.S. banks $59 billion and have barely managed to avoid default over the past two years.
This foreign debt is owed primarily to nine major institutions: BankAmerica in San Francisco, First Chicago and Continental Illinois in Chicago, and Citicorp, Chemical, Chase Manhattan, Manufacturers...
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