Donald Trump, who often says he only likes winners, tells one grand tale of loss: In 1990, he nearly went bankrupt and was forced to ask dozens of banks to whom he owed money to change the terms on their loans and forgive some of his debts.
It was, the real estate developer admits in his 1997 book The Art of the Comeback, the darkest period of his professional life. In his telling, it's a story of redemption, of resilience, and proof of his exceptional negotiating skills and shrewd thinking.
Six people who participated in the loan workout negotiations have a different recollection, raising questions about a key part of the personal narrative that many of Trump's supporters have found compelling as he campaigns to be the next president of the United States on Nov. 8. On the campaign trail he has portrayed himself as a survivor and a master negotiator.
Trump says his comeback began when he recognized a downturn in the real estate market and quickly asked banks to renegotiate his loans. "That decision was perhaps the smartest thing I did," he wrote.
The six bankers and lawyers involved in the talks say the bailout wasn't based on any overture Trump initiated with the banks - and the terms of the deal were dictated by what was best for the banks, not Trump.
Three of the participants say Trump didn't acknowledge he had a problem until his lenders reviewed his books, realized he was on the brink of collapse, and summoned him for debt restructuring talks.
While much has been written about Trump's financial troubles at the time, there has been little examination of his description of the bank negotiations in The Art of the Comeback, including his assertion that he chose to initiate those talks.
Trump's spokeswoman, Hope Hicks, declined to comment for this story.
Following the U.S. stock market crash of 1987, a global recession hit New York real estate. New construction stalled, and several big developers declared bankruptcy.
As the real estate market slumped, Trump ran out of cash.
At the beginning of 1990 he owed a combined $4 billion to more than 70 banks, with $800 million personally guaranteed by his own assets, according to Alan Pomerantz, a lawyer whose team led negotiations between Trump and 72 banks to restructure Trump's loans. Pomerantz was hired by Citibank but became lead counsel for the negotiations.
At the time, Trump was not considered a major developer, but he was a New York celebrity. His affair with the actress Marla Maples and his divorce from his first wife Ivana Trump made national news headlines, and his first book, The Art of the Deal, was a bestseller.
He didn't have a large portfolio of real estate in New York, with the notable exceptions of his 5th Avenue building, Trump Tower, completed in 1983, and the Plaza Hotel, which he bought in 1988 after borrowing heavily from Citibank (c).
He also owned three casinos in Atlantic City, having made a financial bet that he could revive the East Coast gambling destination. And in 1989 he added part of an airline to his portfolio, again turning to Citibank for a loan to help finance the acquisition of bankrupt Eastern Airlines Shuttle. He turned it into Trump Shuttle.
In 1989, in response to growing concerns about the economic downturn, the Federal Reserve began asking big banks to review their exposure to the sinking real estate market.
At the beginning of 1990, a credit specialist at one of Trump's biggest lenders decided to take a look at the bank's book of loans to him.
The decision was prompted in part by the Fed's questions, as well as concerns within the bank about its exposure to the real estate market. The credit specialist, who did not want to be identified, concluded at the time that Trump was "about to go into bankruptcy."
"The banks were onto the problem before he was onto the problem," the specialist told Reuters.
Pomerantz said some of the banks became aware of the magnitude of Trump's financial problems when, on a single day, he drew down every cent of a $100 million line of credit one of the banks, Banker's Trust, which was purchased by Deutsche Bank in 1999, had given him to meet his obligations.
Reuters was unable to independently confirm this.
"He did not come to the banks and say 'I have a problem.' That did not happen," said Pomerantz.
Pomerantz, who says he is not a member of any political party, argued in an opinion piece in the Wall Street Journal that Trump's record in real estate was not a good way to measure whether or not he would be a good president.
In The Art of the Comeback, Trump says he began loan workout talks in March 1990 when he informed his bankers he might miss a payment on his casino debts.
"If I had waited just six months longer to renegotiate terms with the banks, I might have lost everything," he wrote. "I would have had to stand in line with a whole bunch of other moguls who were trying to do the same thing."
Soon, in boardrooms of banks and law firms around Manhattan, Trump's deputies and lawyers began a series of meetings with representatives of the 72 banks, which had billions in outstanding loans, according to Pomerantz.
During the same period, Trump was separately renegotiating a series of loans on his Atlantic City casinos. One of the bankers involved in those negotiations, Ben Berzin, said Trump seemed unaware of the depths of his financial troubles even after the banks had stepped in.
"There was a period during these negotiations when he was still spending money like a drunken sailor," Berzin said, recalling the uproar among the bankers when, in a TV interview in the summer of 1991, Trump displayed a large diamond engagement ring he had given Maples. Media reports said the ring cost $250,000, and Pomerantz said the bankers complained about it to Trump in their next meeting.
At one point, Trump invited all of the bankers to a Broadway show that Maples had a role in, according to Berzin and a banker who took part in the larger talks with the 72 banks. Both said they believed Trump was trying to curry favor to win better terms in the workouts. Berzin attended the show but the other banker did not.
Trump described Berzin in The Art of the Comeback as a "jerk" who would "scream at people at the top of his lungs about nonsense." Berzin said he was irritated by Trump's characterization and denied ever raising his voice in a meeting.
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In his book, Trump says he told representatives of the 72 banks he would declare bankruptcy and "tie you guys up for years" in the proceedings unless they staked him $65 million to keep his businesses running until the real estate market recovered. He also wanted them to agree to defer all loan payments until that time.
"The banks more than capitulated - they enthusiastically agreed to my proposal," Trump wrote.
The bankers and lawyers interviewed dispute this. Though it was true that a personal bankruptcy would have made it harder for the banks to collect what Trump owed them, he had little leverage in the talks, they said.
He, too, would have been seriously hurt in a bankruptcy, especially since he had personally guaranteed so much of what he had borrowed. In Pomerantz's analysis, he would have been able to hold on to little else beyond his home and his pension plan.
During the 18-month process of negotiations and asset sales, Trump also asked for more time to develop his business ideas, like his plan to turn hotel rooms at the Plaza Hotel into condominiums, according to one of the bankers, who declined to be identified.
That proposal was vetoed. While he did receive a $450,000-a-month allowance from the banks to keep his business operations going, it was structured and executed on the banks' terms, several of the negotiators said.
The banks decided they could recover more of the $4 billion they were collectively owed if they sold Trump's holdings one by one, waiting until the market recovered, rather than taking possession of the assets, four participants in the talks said.
These individuals said the banks agreed to forgive Trump's personal liabilities in exchange for his help in selling the properties. The proceeds of the sales would then be split among the banks.
Trump agreed that the banks could take away all his personal property, including his beloved Florida estate, Mar-a-Lago, if he failed to execute the agreement.
"We had to be sure he would pay attention," Pomerantz said of the liens on Trump's personal holdings. "We would meet with him every Friday morning. He was under very strict restrictions by the banks."
Trump worked with the bankers to sell his assets, even when he disagreed about the timing of the sales, most notably when Citibank eventually sold The Plaza.
The banks did not recover 100% of what they were owed and several lenders vowed never to work with Trump again.