国际英语新闻：Two U.S. banks to keep accepting California IOUs

LOS ANGELES, July 11 (Xinhua) -- As California legislature still embroiled in a fight over how to close a budget deficit, Citibank and Bank of the West would honor state officials' requests that they continue accepting California IOUs, it was reported on Saturday.

Bank of the West will take IOUs indefinitely, while Citi has extended its deadline by a week to July 17, the Los Angeles Times reported.

    But most other banks refuse state officials' requests to keep redeeming customers' IOUs for full cash value, according to the paper.

A traffic light is pictured in front of a Citibank branch in Singapore February 23, 2009.

    Due to a 26-billion-U.S.-dollar budget deficit, the California government is expected to issue nearly 3 billion dollars worth of interest-bearing IOUs this month.

    Starting from Saturday, major banks such as Bank of America Corp., Wells Fargo & Co., JPMorgan Chase & Co. and Union Bank of California will stop accepting the IOUs, also called registered warrants, according to the paper.

    Hoping to pressure the state to settle on a budget, the banks rejected state Treasurer Bill Lockyer's requests to continue redeeming the IOUs for their full value in cash, said the paper.

    Citi and Bank of the West were the only banks to agree to Lockyer's entreaty, the treasurer said in a statement.

    Lockyer said the other banks' refusal to keep taking IOUs was "disappointing."

    Bank of the West decided to allow customers to deposit IOUs indefinitely, said Tom Dresslar, a spokesman for Lockyer's office. Citi will accept IOUs only from people who were customers as of June 30.

    "We do not want to penalize our business and consumer customers for the impasse in Sacramento," Rebecca Macieira-Kaufmann, president of Citibank California, said in a statement.

    The IOUs reach maturity in October. But creditors including citizens expecting tax refunds, state vendors and city governments, may have to turn to credit unions or secondary markets to recoup some or all of their value before then, according to the paper.