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121170 1 (1983-04-20)

handle is hein.gao/gaobacszt0001 and id is 1 raw text is: 




             UNITED STATES GENERAL  ACCOUNTING OFFICE
                     WASHINGTON,  D.C.  20548

                                          For Release on Delivery
                                          Expected at 9:30 a.m.
                                          April 20, 1983

121170                     STATEMENT OF

                       CHARLES A.  BOWSHER
            COMPTROLLER GENERAL  OF THE UNITED STATES

                           BEFORE  THE

               HOUSE COMMITTEE ON  BANKING, FINANCE
                        AND URBAN AFFAIRS

       SUBCOMMITTEE ON FINANCIAL  INSTITUTIONS SUPERVISION,
                    REGULATION AND  INSURANCE

                               ON

   BANK EXAMINATION FOR COUNTRY  RISK AND INTERNATIONAL LENDING


Mr. Chairman and Members of the Subcommittee:

     We are pleased to be here today  to discuss our report Bank

Examination for Country Risk  and International Lendinq, issued

on September 2, 1982, our assessment of  the requlatory changes

proposed by the Federal bank authorities  to address the problem

of country risk, and other  issues.

     A high level of international  lending is needed to support

international economic growth  and to expand U.S. exports.  How-

ever, increased international  lending has intensified exposure

of U.S. banks to country risk  (also known as transfer risk)--

the possibility that adverse economic,  social, or political cir-

cumstances may prevent a country's borrowers  from making timely

(or in the extreme, any) repayment of  interest or principal.  In

recent years, country risk has  increased as a wideninq number of

countries have developed balance-of-payments difficulties,

including countries where U.S. bank exposure  is very large.

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