JPMorgan Chase's $20 billion unsecured loan to AT&T to take over T-Mobile could harm consumers

JPMorgan Chase's $20 billion unsecured loan to help AT&T take over T-Mobile could be harmful to consumers by encouraging other risky deals, Moody’s Investors Service said on Monday.

Moody’s called the loan offer a “credit negative,” according to Bloomberg Businessweek.

“JPM’s large AT&T commitment highlights how the risk profile of a capital-markets business can change quickly,” analyst Sean Jones wrote in a research note.

JPMorgan is the only lender involved in the bridge loan to AT&T, which announced earlier this month that it was making a $39 billion cash and stock offer for T-Mobile, currently owned by Deutsche Telekom.

 “If this translates into giving the bank an advantage in winning the mandate to underwrite AT&T’s long-term bond issuances to pay off the bridge facility, then it may encourage more banks to take on greater single-risk exposure, which would be credit-negative for the industry, including JPM,” Jones wrote.

http://mobile.nationaljournal.com/tech/jpmorgan-taking-chances-with-at-t-loan-moody-s-says-20110328

until the 'loan' is paid off

BANKER PROBLEMS?

Firms own a mobile phone company through use of an unsecured loan?

the biggest banking firms own our government, which has been obvious since October 2008. (And using "collateral" of dubious value to pay off nine to thirty trillion dollars worth of loans is a nice trick. Big Banking has some very creative people in its ranks.)

A much more affordable solution than gifting trillions for them to paper over bad debts.

good thing i`m a us cellular customer

The AT&T deal may not go thru, and if it does, it may blow up for AT&T, which means also JP Morgan.

on the backs of the American public
:grr:

them out...I forget, since there are SO MANY mega-conglomerates out there committing massive fraud. Hard to keep track - someone needs to put the crooks on baseball cards.