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Michigan offers 150 million to FIs for loans in credit squeeze
LANSING, Mich. (11/10/08)--To help state consumers and businesses hurt by the nation’s frozen credit markets, Michigan Gov. Jennifer Granholm said Thursday she will free up $150 million from the state treasury for credit unions and banks to loan to those in need. Granholm also will ask state lawmakers to permit a 90-day moratorium on foreclosures to provide homeowners with a chance to refinance their loans with lenders (Detroit Free Press Nov. 7). “We are working in close cooperation with the Granholm administration to address Michigan's economic challenges,” David Adams, president/CEO of the Michigan Credit Union League, told News Now. “We appreciate the very careful yet aggressive way that the foreclosure crisis is being approached as more focus now shifts to lenders’ risks. “In the months and years ahead, we intend to work with the governor and the legislature to help Michiganians save, borrow and invest during a tough economy,” he added. Under Granholm’s initiative, the state will purchase $150 million in certificates of deposit (CDs) from state credit unions and banks. The state will obtain competitive interest on the CDs, and then credit unions and banks will use the money to provide loans--80% of which will go to Michigan businesses, Granholm told the newspaper. The manner in which the remaining 20% is loaned out is yet to be determined, Terry Stanton, Michigan Department of Treasury spokesman, told the paper. The $150 million would be culled from a cash fund that’s routinely invested in financial markets, he added.
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