Donald Trump was burning through cash. It was early 2016, and he was lending tens of millions of dollars to his presidential campaign and had been spending large sums to expand the Trump Organisation's roster of high-end properties.
To finance his business's growth, Trump turned to a longtime ally, Deutsche Bank, one of the few banks still willing to lend money to the man who has called himself "The King of Debt."
Trump's loan request, which has not been previously reported, set off a fight that reached the top of the German bank, according to three people familiar with the request. In the end, Deutsche Bank did something unexpected. It said no.
Senior officials at the bank, including its future chief executive, believed that Trump's divisive candidacy made such a loan too risky, the people said. Among their concerns was that if Trump won the election and then defaulted, Deutsche Bank would have to choose between not collecting on the debt or seizing the assets of the president of the United States.
Two of the people familiar with the loan request said the Trump Organisation had been seeking to borrow against its Miami resort to pay for work on a golf property in Turnberry, Scotland.
A Trump Organisation spokeswoman, Amanda Miller, denied that the company had needed outside funding for Turnberry.
"This story is absolutely false," Miller said. "We bought Trump Turnberry without any financing and put tens of millions of dollars of our own money into the renovation, which began in 2014. At no time was any money needed to finance the purchase or the refurbishment of Trump Turnberry."
She did not specifically address whether the Trump Organisation had sought a loan from Deutsche Bank.
Troy Gravitt, a Deutsche Bank spokesman, declined to comment.
The failed loan request is an untold chapter in Trump's long and tortured relationship with the banking industry – and is likely to attract scrutiny from Democrats on two House committees that are investigating his two-decade relationship with Deutsche Bank.
In the early 1990s, Trump's hotel and casino properties declared bankruptcy four times, leaving prominent banks, including Citicorp and Manufacturers Hanover, with painful losses. The real estate mogul was all but excommunicated from Wall Street.
Deutsche Bank, which was eager to gain a foothold in the lucrative US market and more tolerant of risk than many of its rivals, filled the void. In 1998, it lent Trump $US 125 million ($172m) for renovations on a Wall Street skyscraper. The relationship blossomed, and over the next 17 years, Deutsche Bank lent or participated in loans to Trump and his companies totaling more than $2.5 billion.
Then, just as the first votes were being cast in the Republican presidential primaries, Trump's lender of last resort got cold feet.
The funding of Trump's golf empire has been something of a mystery.
In the decade before he was elected president, Trump's company spent hundreds of millions of dollars buying or renovating about a dozen clubs and resorts around the world. Despite Trump's self-proclaimed fondness for relying on debt, the Trump Organisation has reported that it used its own money for most of the acquisitions and upgrades.
A prominent golf journalist, James Dodson, said Trump's son Eric had told him in 2013 that the company's golf properties were funded by Russians. Eric Trump has denied making the comment.
Trump did borrow money for some of his golf properties. In 2012, Deutsche Bank lent the Trump Organisation a total of more than $US100 million ($137m) to finance the 72-hole Doral resort near Miami, home to the famed Blue Monster course.
Two years later, the Trump Organisation bought the Turnberry hotel and golf course for a reported $US63 million ($86.8m). The course, which features sweeping views of the sea west of Scotland, has hosted the British Open several times.
In 2014 and 2015, a Trump legal entity lent at least $96 million to the subsidiary that operated Turnberry, according to British regulatory filings. The next year, the Trump Organization would go back to Deutsche Bank for more.
The relationship between Trump and Deutsche Bank had survived some rocky moments. In 2008, amid the financial crisis, Trump stopped repaying a loan to finance the construction of a skyscraper in Chicago — and then sued the bank, accusing it of helping cause the crisis. After that lawsuit, Deutsche Bank's investment-banking arm severed ties with Trump.
But by 2010, he was back doing business with Deutsche Bank through its private-banking unit, which catered to some of the world's wealthiest people. That unit arranged the Doral loans, and another in 2012 tied to the Chicago skyscraper.
Trump's go-to in the private bank was Rosemary Vrablic, a senior banker in its New York office. In 2013, she was the subject of a flattering profile in The Mortgage Observer, a real estate magazine owned by Trump's son-in-law, Jared Kushner, who was also among her clients. In 2015, she arranged the loan that financed Trump's transformation of Washington's Old Post Office Building into the Trump International Hotel, a few blocks down Pennsylvania Avenue from the White House.
In early 2016, as Trump was lending tens of millions of dollars to his campaign, his company contacted Vrablic about getting money for Turnberry, said two of the three people familiar with the request, who spoke on the condition of anonymity because they weren't authorised to discuss the matter publicly. The proposal was to expand Deutsche Bank's outstanding loans backed by the Doral by well over $10 million and to use the proceeds for work on Turnberry, the people said.
The New York Times
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