One example of a solvent partnership falling under this rule could be a situation in which the FMV of the equity interest exchanged is less than the face amount of the debt, due to a change in market interest rates
as compared to the interest rate used by the debt instrument.
An interest rate that varies with the level of short-term market interest rates
is applied to seasonal credit.
First Industrial acquired the portfolio and the Lazarus Burman operations for $86.4 million cash, assumption of $4.5 million permanent fixed-rate debt at market interest rates
and the issuance of 1.6 million limited partnership units in First Industrial's subsidiary, First Industrial, L.P.
The report said that while the FASB proposed to discard the notion that undiscounted cash flows should be used to measure losses from problem loans, "its techniques for developing estimates of such losses do not require consideration of market prices or market interest rates
in either computing loss reserves or as a reality check on such reserves."
Additionally, increasing market interest rates
and seasonal withdrawal of funds from business accounts slowed core deposit growth this quarter."
As in previous years, surplus liquidity will be absorbed through BoR deposit auctions and issues of BoR coupon bonds (KOBRs), both intended to limit the impact of a structural liquidity surplus on macroeconomic fundamentals and market interest rates
. These findings are reported in the 21st issue of 'Banking sector liquidity and financial markets', a regular BoR commentary.
According to the regulator, low capital market interest rates
in Europe have reduced income for insurers from investments in bonds and other safe securities.
The bank is raising its rate on a one-year time deposit to 0.05 percent per annum from the current 0.03 percent, in response to the Bank of Japan's recent termination of the quantitative ultra-easy monetary policy, which has pushed up market interest rates
Loans made at fair market interest rates
by plans with parties-in-interest;
The Federal Open Market Committee's target for the federal funds rate will not change as a result of the adoption of these programs, and the level of market interest rates
more generally will be unaffected.
Through the Hudson Country Improvement Authority, the fund has allowed municipal governments or qualified profit or non-profit corporations to borrow funds at about two points below market interest rates
by using proceeds from tax-exempt bonds.
"We also need to measure loan impairment by using discount rates tied to current market interest rates
. If we can reach these two goals during my term in office, we will have made great strides toward restoring the relevance of financial statements."