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As New York City real estate wobbled and then collapsed, European American Bank quickly emerged as the junk-yard dog of real estate lenders. It was the first to foreclose, the first to sue on personal guarantees, the first to force owners toward the precipice of bankruptcy.
"It seemed like it was almost a vendetta for them," says one EAB borrower.
This year, however, the bank's growl has turned into a purr. It is settling or has settled bitter disputes with borrowers like Peter Kalikow, Arthur Cohen and David Solomon. As new problems develop it is taking a more conciliatory attitude than it has in the past.
"It's very easy to throw a grenade in the process, but that's not where we're coming from, says Ronald O. Drake, chief executive of Euram Management Inc., the separate company EAB's parent established in 1991 to work out its bad real estate loans. "We're not in the punishment business."
Euram's new posture is welcome news for other real estate lenders, as well as borrowers. By taking a hard-line position, Euram has undercut efforts by other banks to engineer global restructurings of a troubled developer's properties.
PERSONALITIES AT WORK
At the same time, the bank's change in demeanor is a dramatic demonstration of the importance of personalities in the workout process. The bank's tough tone was set by J. Richard Budd 3d, who ran Euram Management from its inception until early this year when he left to take a job with the accounting firm Zolfo, Cooper & Co.
His interim...