The study also showed that banks were bracing for more sour loans by setting aside large reserves to cover losses.

Most of these sour loans are a product of reckless lending made during the boom of the late 1980's.

False documents and sour loans dominated the books of B.C.C.I., regulators and auditors say.

The selloff has pushed the shares of some banks, which are struggling to dispose of billions of dollars in sour loans, to precarious levels.

Reed's bank was choking on sour third-world loans, and his well-paid economists hadn't warned of this deadbeat debacle.

The trust banks announced earnings declines and a growing number of sour loans today.

The total amount of sour loans rose by more than a third from a year earlier, the survey found, but only 11 percent were at United States banks.

Those sour loans will be transferred to Konsolidacni Banka.

Depressed property prices and more than $400 billion in sour loans still impose a costly drag on the economy.

Some have also helped banks raise capital so they can more easily write off their sour loans.