According to Vanity Fair, Eric Trump was offended by the suggestion that his father, President Donald Trump, would default on a loan. This comes as Deutsche Bank Chairman Paul Achleitner worried that the president would default on $340 million in loans.
After the 2016 election, the bank management was apparently “so concerned” that Trump would default on his loans while he was in office that they discussed extending the repayment dates until 2025, when Trump is out of office.
The debts include $125 million for the Trump Doral Miami resort, $170 million for the Trump International Hotel in Washington, and a loan against a Chicago tower. The loans are due in 2023, 2024, and 2024 respectively.
The bank’s concerns were reportedly related to “the public relations disaster [Deutsche] would face if they went after the assets of a sitting president” and not to “any heightened concerns about the creditworthiness of Trump or his company.” Yet, in truth, the bank’s concerns could likely be a combination of the two.
In 2008 Trump sued the bank to avoid paying back the $40 million loan he took out. Trump’s suit claimed the bank should actually be paying him $3 billion for being one of the companies “responsible for the economic dysfunction we are currently facing.” The firm countersued and Trump subsequently moved his business from Deutsche’s investment banking division to its private wealth-management group.
Deutsche ultimately decided against restructuring the outstanding loans and chose instead to not do any more business with the Trump Organization during Trump’s presidency.
Eric Trump, who runs the company’s day-to-day operations, said of the Trump loan issue: “This story is complete nonsense.” He added: “We are one of the most under-leveraged real estate companies in the country. Virtually all of our assets are owned free and clear, and the very few that do have mortgages are a small fraction relative to the value of the asset. These are traditional loans, no different than any other real-estate developer would carry as part of a comparable portfolio.”
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