- 20 -
million. The second partnership investment was recommended
because Brunswick was generating additional cash and capital
gains from the sale of its Technical businesses and Nireco stock.
The Board of Directors also authorized McManaman and/or O'Brien
to enter into agreements on behalf of Brunswick for the purchase
and sale of treasury securities for forward delivery and to
increase the amount authorized for interest rate swap
transactions up to $225 million.
F. O'Brien's Interest Rate Forecast
One of O'Brien's duties as Brunswick's treasurer was to
track the movement of interest rates. In early 1990, O'Brien
believed that interest rates would rise. However, during the
period June through September 1990, O'Brien's view of the
direction of interest rates was "in transition", and he was
uncertain whether interest rates would rise or fall. By early
September 1990, O'Brien was convinced that interest rates would
fall.
II. Algemene Bank Nederlands N.V.
During the period in question, Algemene Bank Nederlands N.V.
(ABN), was the largest bank in the Netherlands. During all
relevant periods, ABN offered comprehensive corporate,
institutional, and individual financial services including
domestic and international lending, trade finance and
international payments, international corporate finance and
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