On Tuesday, Marshall & Ilsley Corp. (MI), commonly known as M&I, announced the extension of its foreclosure moratorium term by an additional 90-day period. The moratorium was initiated on Dec 18, 2008, as a part of the Homeowner Assistance Program. The foreclosure suspension now ends on Mar 31, 2009.
The notice came as a breather for many homeowners distressed by the loan repayment issues. The foreclosure suspension is currently on all owner-occupied residential loans for customers who realistically work out to arrive at a successful repayment agreement. The moratorium applies to applicable loans in all M&I markets.
M&I’s Homeowner Assistance Program is streamlined to help the programs generated for potentially troubled homeowners who are identified in advance and proactively offered assistance. It also offers programs to reduce foreclosures through several refinancing options, including term extensions and reduced rates that can be used, as applicable and necessary, to reduce monthly payments.
Additionally, M&I remains consistent in providing fresh credit to both its new and existing customers. Till Oct 31, 2009, M&I had already loaned out $5.5 billion of new credit since receiving additional capital from U.S. Treasury through its Capital Purchase Program in mid-November 2008.
The ongoing financial turmoil has marred core growth across sectors and financial services did not go unscarred. Non-performing loans, declining credit quality on a lean job market and constant fluctuations in the financial markets led to a substantial loss of earnings as compared to historical levels. However, M&I has been able to meet most of the challenges by drastic cost-cutting, bonus-freezing and dividend reduction measures.
We believe that as the economy advances to a more favorable environment, M&I with a large loan loss reserve, a strong capital base and ample liquidity will be able to meet the fund requirements of its customers and also prevent foreclosures. This is noticeable from the fact that Tuesday’s announcement of extending the foreclosure moratorium is incidentally not the first one. The company has previously extended its foreclosure suspension for 90 days on Sept 28, 2009 and twice before that on June 26, 2009 and Mar 31, 2009, thereby diminishing the threat of homelessness to customers by way of a foreclosure.
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