Wednesday, September 30, 2009

Treasury Announces Initial Closings of Public-Private Investment Funds

The Treasury is still pumping out prop up money. Today, it announced the initial closings of Public-Private Investment Funds (PPIFs) established under the Legacy Securities Public-Private Investment Program (PPIP). As of today, the following two PPIFs have completed initial closings, each with at least $500 million of committed equity capital from private investors:

Invesco Ltd. (Invesco Legacy Securities Master Fund, L.P.)
The TCW Group, Inc. (UST/TCW Senior Mortgage Securities Fund, L.P.)

Firms that are partnering with the fund managers completing initial closings today include:

· Atlanta Life Financial Group, through its subsidiary Jackson Securities
· Muriel Siebert & Co., Inc.
· The Williams Capital Group, L.P

To date, collectively the PPIFs have closed on approximately $1.13 billion of private sector capital commitments, which have now been matched 100 percent by Treasury, representing total equity capital commitments of $2.26 billion. Treasury will also provide debt financing up to 100 percent of the total capital commitments of each PPIF, representing approximately $4.52 billion of total equity and debt capital commitments.

The Treasury does realize it is a bit behind in just funding this program at this point, as part of its release it stated:

In recent months, financial market conditions have improved and the prices of legacy securities have appreciated. In addition, the results of the Supervisory Capital Assessment Program enabled banks to raise substantial amounts of capital as a buffer against weaker than expected economic conditions. While these developments have enabled Treasury to proceed with the PPIP program at a scale smaller than initially envisioned, Treasury remains prepared to expand the amount of resources committed to PPIP should conditions deteriorate.

No comments:

Post a Comment