The Federal Deposit Insurance Corporation (FDIC) announced the launch of a new program to encourage small investors and asset managers to partner with larger investors to participate in the FDIC's structured transaction sales for loans and other assets from failed banks. The Investor Match Program will help to facilitate partnerships in order to bring together sources of capital and expertise. Participants in the program will use a customized database to identify potential collaborations, which will be identified at the sole discretion of the participating firms.
The FDIC believes in the value of facilitating a cooperative solution between large investors and small investors and asset managers. The goal of the Investor Match Program is to expand opportunities for participation by smaller investors and asset managers, including minority and women-owned (MWO) firms, in FDIC structured sales transactions. The program has additional goals that include knowledge transfer and increased effectiveness of execution by small investors and asset managers via enhanced organizational competencies.
"The program is an example of our commitment to ensure that the structured sales transaction process is inclusive of all firms large and small. We believe that expanding the investor pool will assist in minimizing losses to the Deposit Insurance Fund (DIF). This innovative strategy will leverage technology to more effectively dispose of assets that the FDIC has inherited through failed bank receiverships," said Pamela Farwig, Deputy Director, Division of Resolutions and Receiverships.
The Investor Match Program, part of a larger effort to expand outreach efforts with small investors, is executed via an automated online networking platform. The networking platform enables participants to identify potential partners and provides a forum to connect with them.
The FDIC strongly encourages all potential investors, especially small, minority- and women-owned investors to register for the Investor Match Program today. To participate in the Investor Match Program, every investor must be pre-qualified to bid in FDIC structured sales transactions. Go to: http://www.fdic.gov/buying/financial/investormatchprogram.html to learn more about the Investor Match Program, pre-qualification process and to pre-qualify. Once pre-qualified, you will be invited by an email notification to be a part of the Investor Match Program.
The FDIC's structured transactions are one of several strategies used to sell assets retained from failed banks. Loans and real estate are transferred to a Limited Liability Company (LLC). The FDIC then sells an equity stake in the LLC to an investor. The investor is responsible for managing the LLC and working the assets to maximize their value. This technique allows the FDIC to capture any potential future upside from the assets. The dollar amount of the assets sold range from several hundred million to well over a billion dollars. The Investor Match Program opens the door to investors who otherwise would not have the resources necessary to participate in such sales.
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Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's banking system. The FDIC insures deposits at the nation's 7,513 banks and savings associations and it promotes the safety and soundness of these institutions by identifying, monitoring and addressing risks to which they are exposed. The FDIC receives no federal tax dollars – insured financial institutions fund its operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically (go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information Center (877-275-3342 or 703-562-2200). PR-148-2011