THE BASIS POINT

100 Fund Mangers Apply For PPIP Program, Treasury To Respond May 15

The Treasury Department today announced the receipt of more than 100 unique applications from potential fund managers interested in participating in the Legacy Securities portion of the Public Private Investment Program (PPIP). Applying firms include traditional fixed income, real estate, and alternative asset managers.

Successful applicants must be headquartered in the US and demonstrate a capacity to raise private capital and manage funds in a manner consistent with Treasury’s goal of protecting taxpayers. Treasury will also evaluate the applicant’s depth of experience investing in eligible assets.

Treasury expects to inform applicants of their preliminary qualification around May 15, 2009. Once a fund receives preliminary qualification, it can begin raising the expected minimum of $500 million in private capital that will serve as the investment that, pending further approval, will be matched with taxpayer funds. Treasury anticipates opening the program to smaller fund managers in the future, which may result in a lower minimum private capital raising requirement.

Since announcing the program details on March 23, Treasury has encouraged small, veteran, minority and women-owned private asset managers to partner with other private asset managers.

Today’s announcement is the latest in making operational the PPIP for legacy loans and securities, a key part of the Administration’s efforts to repair balance sheets throughout our financial system and ensure that credit is available to households and businesses to help drive economic recovery.