Cashing in on the Federal Quarter-Trillion Dollar Loan Portfolio


 

Publication Date: October 1986

Publisher: Heritage Foundation (Washington, D.C.)

Author(s): John E. Buttarazzi

Research Area: Banking and finance

Keywords: Economy

Type: Report

Abstract:

Loan sales are a routine aspect of modern financial management in the private sector. Yet despite the efforts of the last three Administrations, federal credit programs continue to be managed inadequately, thanks to anachronistic accounting methods, defective monitoring, dilatory collections, and almost nonexistent controls. These problems are systemic; they arise from the fact that the government owns the loan portfolio. They can be solved only through the incentives that accompany a transfer to private ownership.