Although it’s not yet been posted to the FDIC’s comment page, Wilbur Ross has submitted his two cents to on the agency’s onerous reform proposals for buyout firm investments in banks, he told Bloomberg.
Once the loudest proponent of bank investing, Ross said his firm, WL Ross & Co., will “never again” submit a bid for a failing bank under the proposed set of rules.
Those are strong words coming from someone who attended Sheila Bair’s roundtable discussion in early June and walked away calling the meeting “highly productive.” I suppose his speaking out is just a matter of taking extra care to ensure the FDIC hears and abides by his concerns.
Maybe he’s also trying to scare up more support from his bank-buying private equity peers. Their comments are suspiciously absent from the the FDIC’s comment board, which has garnered a few more letters since we last checked in. Blackstone Group, Carlyle Group, J.C. Flowers, and Centerbridge Partners, which have all invested in banks in the last year, are mum.
A few notable comments:
Dory Wiley, the CEO of Commerce Street Capital, a formal letter addressing each of the FDIC’s questions, arguing, of course, against the Tier 1 leverage ratio.
OneWest Bank Group CEO Steven T. Mnuchin and OneWest Bank CEO Terrence Laughlin (the company purchased Indymac) wrote to express the importance of “case-by-case reviews” for capital requirements, versus a “one size fits all” Tier 1 leverage ratio requirement.
The only comment that asked for harsher regulations was from an accountant from Michigan named Mark Maisonneuve. He wrote to express his disapproval of buyout firms in general, based on his observations of Cerberus’ bang-up job with Chrysler. He says: “Private equity is the tenement landlord capital of the financial world. If that is all that is available we are in greater straits than we realize.”