By William Selway
JPMorgan Chase & Co. agreed to lend California $1.5 billion, a cash infusion that will allow the most-populous U.S. state to stop issuing IOUs to businesses, taxpayers and municipalities early next month.
The loan will be secured through the private sale of securities to the bank by Aug. 28, said Tom Dresslar, a spokesman for Treasurer Bill Lockyer. It will be repaid with the proceeds of a $10.5 billion sale of revenue anticipation notes, which are used to pay expenses until the bulk of state taxes are collected later in the budget year.
JPMorgan was among banks that last month stopped accepting IOUs from its customers that California issued amid a political deadlock over its finances.
Continue reading JPMorgan to Lend California $1.5 Billion to End IOUs (Update1)
