Asian Art Museum Faces Financial Woes

San Francisco’s Asian Art Museum is in dire financial straits and could be forced into bankruptcy if it can’t work out a new deal with its lender, according to the San Francisco Gate’s Phillip Matier and Andrew Ross.

The museum’s troubles started in 2005 when its directors, hoping to hedge against rising interest rates, restructured $120 million worth of loans to try to save millions of dollars.

But now rates have hit rock bottom, and their lender, JPMorgan Chase, says it plans to close the museum’s line of credit––in which case, the institution would lose $20 million that it put up in collateral.

“They could only keep up with the payments for maybe a year or a year and a half before they would have to close their doors,” said the source, who spoke on condition of anonymity because he is not cleared to discuss the negotiations publicly.

The museum’s directors have hired bankruptcy lawyer named Bruce Bennett––who helped restructure Orange County’s $10 billion debt a few years back––to try to buy the museum extra time to turn around its finances.

Asian Art representatives also plan to huddle with Mayor Gavin Newsom’s staff today in hopes of getting help with another line of credit. However, one city representative, speaking on condition of anonymity, said, “Nobody is using public money to bail them out.”