i think it's all over, page-60

Hi f111,

Yes I am aware of the two streams of assessment.

JMHO from past experience ( retired Chief Credit office and Chairman of Loan Committees ) I would say that the "Banks" have required BBP to supply weekly financial reports to monitor their status. IMHO At this level of exposure I would be very surprised that the lead bank is not monitoring BBP weekly if not daily. I know that is what I would be requiring. They may will be in breach of some loan agreements covenants but we both know that "forbearance agreements" can be agreed to with due consideration given.

IMO based on the announcement and comments made in the press the banks are still working with BBP. In my experience it is cheaper to negotiate than litigate.

Time will tell what is actually happening.

Cheers,
Brantley


http://www.reuters.com/article/rbssUtilitiesElectric/idUSSYU00653520090515

Babcock & Brown Power says in talks with banks

PERTH, May 15 (Reuters)

Section from article:

//Banking sources told Reuters Basis Point on Wednesday BBP is in talks with its lenders to amend the terms on a A$2.6 billion ($2 billion) project finance loan to give it breathing space to sell assets.//


Section from announcement:

The novation of these contracts will have a positive effect on BBP's cash flows going forward. This arises as a result of the elimination of expected future losses under the contracts.

Ross Rolfe, CEO of BBP, said "While a further deterioration in operating performance is very disappointing, there are a number of initiatives being implemented to strengthen the company's operational earnings and cash flows going forward.

These include the novation of the FOT onerous contracts and the recently announced disposal of AEATM,

both of which significantly improve the company's future cash flows.

In addition to the steps being taken to stabilise the company's operating position,

we remain pro-actively engaged with our lenders on the longer-term work through option."