Local
Bank agrees to defer claim for $43 million Metro payment
By: Taryn Luntz
Examiner Staff Writer
October 31, 2008
A bank that was demanding a $43 million payment from Metro by today agreed in federal court Thursday to defer its claim for 10 business days.
The payment to KBC Bank is for the termination of a deal that is one of many made by Metro, all of which are in trouble after insurers such as American International Group, which backed Metro’s financial agreements, lost their high credit ratings amid the economic crisis. The deal terms require the insurers to maintain a AAA credit rating.
“We’re pleased with the judge’s decision,” said Metro Chief Financial Officer Carol Kissal.
“But Metro could find still itself in default and on the hook for millions of dollars in the next two weeks. We urgently need the Treasury Department to step in.”
A preliminary injunction hearing is scheduled for Nov. 12.
The payment to KBC Bank is for the termination of a deal that is one of many made by Metro, all of which are in trouble after insurers such as American International Group, which backed Metro’s financial agreements, lost their high credit ratings amid the economic crisis. The deal terms require the insurers to maintain a AAA credit rating.
“We’re pleased with the judge’s decision,” said Metro Chief Financial Officer Carol Kissal.
“But Metro could find still itself in default and on the hook for millions of dollars in the next two weeks. We urgently need the Treasury Department to step in.”
A preliminary injunction hearing is scheduled for Nov. 12.
