Bankers from 31 major international lending institutions today agreed to set up a research organization to upgrade the quality of information gathered on the condition of government borrowers.
The group, known as "Ditchley II," for the Ditchley, England, site of their first gathering six months ago, ended a day and a half of general discussions early this afternoon. The talks focused on general lending practices and ways to avoid the strains on the world financial system caused by the loan repayment reschedulings being sought by developing countries.
"The financial community will basically make independent decisions," William Ogden, vice chairman of Chase Manhattan Bank, said in an interview. Ogden, who serves as chairman of the Ditchley group, said, "information is the key" to situations like the current rescheduling problems. "You can't coerce bankers."
Ogden repeatedly emphasized that the organization is not a "crisis group" in response to the troubled world economy and said that only during the coffee breaks were comments made about specific situations, like the massive $80 billion Mexican debt problem now facing the International Monetary Fund.
The organization "is anticipatory," he said. "It's a longer-term look to avoid the issues in some countries today. But we will proceed as quickly as possible."
Leading economists and central bankers have raised concerns about the consequences of the massive loans made by international banks to developing countries, particularly as the recession and other economic problems have limited the ability of a number of nations, especially in Latin America, to meet their obligations.
Already in 1982, at least $50 billion in sovereign debt has been rescheduled by major banks. Ogden and other industry spokesman, however, have downplayed the rescheduling problem's impact on bank solvency, calling the issue instead a question of liquidity.
The Ditchley group is aimed at averting such surprises. Any bank lending money across national borders would be eligible to join the institute. Its mission, according to a statement released at the close of the meeting, will be to "promote the exchange of information" concerning borrowers' "financial situation, development plans, economic policies and existing and proposed foreign exchange obligations."
The statement was released by representatives of three Canadian banks, three from France, two from the Netherlands, three from Japan, three from Switzerland, four from Great Britain, and four from West Germany.
U.S. banks involved in addition to Chase Manhattan were Bank of America, Bankers Trust Co., Citibank, Continential Illinois National Bank & Trust Co., First National Bank of Chicago, Manufacturers Hanover Trust Co., Mellon Bank, and Morgan Guaranty Trust Co. of New York.