Under a procedure aimed at preventing a chain reaction of international financial defaults, the Reagan administration has informed U.S. banks that it will pay back some of their loans to Poland until the hard-pressed East European country can resume redeeming its debts.
A policy adopted last week--after heated debate in an interagency working group--authorizes the Agriculture Department's Commodity Credit Corporation to pay the banks the delinquent loan principal and some of the interest as it comes due over the next few months.
The loans were guaranteed by the CCC during the last three years so that Poland could purchase wheat, feed grains, soybeans and other farm commodities here with the aid of private credit.
There was never any doubt that the U.S. government had a legal obligation to cover these loans if Poland failed to pay. However, administration officials favoring a tougher stance in the Polish crisis have argued that the banks should formally announce that Poland was in default and attempt to seize assets, such as ships, before the government honored its guarantee.
Considerable sums of money are at stake in the guaranteed loan program. In January, Poland failed to pay the U.S. banks $71 million in principal and interest. For fiscal 1982, the total exposure on guaranteed loans comes to $308 million, and in the next two fiscal years, the total owed to the banks and guaranteed by the CCC comes to $613 million.
Government sources said yesterday bankers were concerned that their claims to the CCC against Poland's unpaid loans could be taken by other banks as a formal announcement that Poland was in default on its international obligations. This, in turn, could trigger a chain reaction by some 500 banks to which Poland owes money here and abroad.
To reduce the default risks, the sources said, the government gave the banks two options, both involving the CCC's picking up the Polish obligations as they came through. One option is for the CCC to cover the loan principal and 6 percent of the interest. The other option calls for the CCC to pay only the principal owed and to receive interest out of a common "pot" of Polish payments that would go to repay the banks and the U.S. government.
The New York Times, in a news report and in a column by William Safire, reported that the procedure for handling the unpaid loans involved drafting an "emergency regulation."
Safire blamed a "craven State Department" for accepting a recommendation by Deputy Secretary of Agriculture Richard E. Lyng that the bank guarantees be honored without forcing Poland into default. The Safire column, under the headline "Payoff for Represssion," referred to "hardliners" who feel the administration has failed to back up its tough public statements against military rule in Poland with deeds.
Those in the administration who oppose throwing Poland into default argue that such a move would be counterproductive. They say it would provide the Soviet Union and Poland with an excuse to ignore its financial obligations to the West, and would sacrifice a major piece of leverage.
One New York City banker yesterday objected to suggestions that the government was rescuing the banks from the consequences of a default.
"The governments in the West have a heavy responsibility for this whole mess," he said. He said that U.S. government loans and loan guarantees to Poland have risen much faster in the last 18 months than private banking loans. "If the government is not willing to declare a default on its loans and to go out after the Poles, why should they send the banks out to do it?"
U.S. officials acknowledged that Poland's failure to pay its debts had created an unprecedented problem at the CCC. Several years ago Sudan defaulted on a loan repayment to CCC, but the amount was only $9 million, sources said.