Chase put its Brazil loans on non-accrual basis.

Chase Manhattan, parent of the nation’s third-largest bank, joined several other large U.S. banks preparing themselves for a showdown with Brazil by announcing that it will place $2.3 billion in Brazilian debt on non-accrual or cash status, a move that will reduce first-quarter profit by $31 million. The bank said it decided to make the move because of the uncertainty of resumption of interest payments by Brazil, which declared Feb. 20 that it was indefinitely suspending interest payments to foreign banks. Chase also reclassified about $280 million of its loans to Ecuador because of that country’s earthquake-related debt repayment difficulties.