WASHINGTON - Banks would have an easier time clearing their portfolios of illiquid real estate assets under a bill recently introduced in the House.
The bill, sponsored by Rep. Clay Shaw, R-Fla., and Rep. Robert Matsui, D-Calif., would make it more attractive for Real Estate Investment Trusts, or REITs, to buy "distressed" real estate from banks, according to Jeff DeBoer, senior vice president of the National Realty Committee.
Mr. DeBoer said the bill would eliminate the current cap barring REITs from deriving more than 30% of their income from real estate held for less than four years.
"Under this bill, if a REIT wanted to buy a distressed property from a bank, they could buy it, fix it up, and sell it off much more quickly," Mr. DeBoer said. "This makes the market more liquid and allows people to trade more freely."
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WASHINGTON - Banking regulators will testify next week when House Banking Committee Chairman Jim Leach continues hearings on the failure of Madison Guaranty Savings & Loan and Whitewater Development Co.
Among those scheduled to appear at the Whitewater hearing are James Renick, the Federal Deposit Insurance Corp.'s inspector general, and John Adair, inspector general for the Resolution Trust Corp.
Also scheduled to testify are James Clark and Dawn Pulcer, former examiners for the Federal Home Loan Bank, the now-defunct thrift regulatory agency. Jean Lewis, Richard Iorio, and Lee Ausen, investigators in the RTC's Kansas City office, also will appear.
The banking committee is looking at a range of issues involving the failure of Madison Guaranty, including the impact of the failed Whitewater company, in which President Clinton was a major investor when he was governor of Arkansas.
