But there has been a big stumbling block: regulation. That is, if a private equity operator takes a 10% equity stake in a bank, the firm may be considered "controlling," which would trigger some onerous compliance requirements and may mean becoming a bank holding company.
Well, according to the Wall Street Journal [a paid publication], the Federal Reserve is now going to loosen things up. The trigger point is now a 33% equity stake (up to 15% can be voting stock). Something else: a private equity firm can even have as many as two board seats.
No doubt, this is a big deal for private equity firms. And it's a nice option for ailing banks.
According to Bloomberg, private equity firms raised $324.4 billion in the first half of this year, and as should be no surprise, the hot area is distressed investing. In other words, the private equity folks have something to be happy about.
Tom Taulli is the author of various books, including The Complete M&A Handbook
and The Edgar Online Guide to Decoding Financial Statements
. He is also the founder of BizEquity, a valuation website
Reader Comments (Page 1 of 1)
9-24-2008 @ 1:58PM
MR. ARTHUR J. M. CHARTIER said...
"ATTENTION" "THE FINANCIAL ISSUES ARE BEING FIXED JUST GIVE IT A LITTLE TIME... AND A LITTLE FAITH" NATIONAL AWARENESS REQUIRED...
WORTH A LOOK ...
http://WWW.AJMC-NATIONAL-INTERNATIONAL-MONETARY-FUND-LLC.INFO...
WEB DEVELOPMENT TEAM IS CORRECTING VARIOUS ISSUES IN LITERATURE AS WE SPEAK... THANK YOU RESPECTFULLY YOURS AJMC...
YOUR THOUGHTS????
PS. IN ABOUT US... MR. HENNERY M. PAULSON JR. (PLEASE REMOVE ONE "N" AND ONE "E") THE CORRECT SPELLING IS MR. HENRY M. PAULSON JR. PLEASE FIX BOTH THEY ARE UNDER
THE CHARLIE ROSE SHOW: THANK YOU...
PLACE ABOVE FDIC... IN U.S. SOLUTIONS...
Completed web site & assistance has been offered to each of the following...
09/22-23/2008 FEDERAL RESERVE
09/18/2008 THE SEC EXTENDS IT'S NAKED SHORT SELLING RULES TO THE STOCK MARKET FINANCIAL SECTOR RESTRICTIONS 30 DAYS...
09/16/2008: JP MORGAN, GOLDMAN SACHS
09/15/2008: AIG RESULTS: UNITED STATES GOVERNMENT ASSUMES 80% / U.S. TREASURY SECRETARY MR. HENRY M. PAULSON JR. / U.S. TREASURY $700 BILLION BAIL-OUT IN PROCESS ...
09/13/2008: COMPLETED WEB SITE SENT TO ALL U.S. SENATORS...WASHINGTON MUTUAL...
09/09/2008 LEHMAN BROTHERS, MERYL LYNCH RESULTS: ( BANK OF AMERICA PURCHASE)
09/05/2008: COMPLETED WEBSITE SENT TO PRESIDENT OF THE UNITED STATES 6:49 PM EST
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THE REMOVAL OF #6 IN MANAGED SPOT FOREX ACCOUNT ACTIVATION AND 4 PIP GRATUITY PER MONTH ARE ALSO INCLUDED IN NEW UPDATES...
9-30-2008 @ 12:04AM
stevekendall said...
JUST SAY NO! By Steve Kendall
Thank god they didn't pass the "bailout" plan! Buying up all the bad mortgage backed securities from all these crazy ___ mortgage banks is ridiculous. So what if the market went down 777, so what if we lost $1.4 trillion in market value today.
We're here to build the future folks, take the damn never ending....
continued at -
www.mortgagebreakdown.com