Buyout Dropout
BSE Management LLC, one of several bank buyout groups formed with the goal of timing the industry's recovery, may be stalling out.
William Isaac, one of the biggest names tied to the Florida-based effort, said last week that with his new post as chairman of Fifth Third Bancorp, he is unlikely to play any role with the project.
"I'm not sure there is even going to be a venture in Florida," Isaac said. "If there is, I'm not sure that I would continue to be a part of it."
Isaac also confirmed that David Moffett, the former U.S. Bancorp vice chairman who went on to run Freddie Mac until he retired last year, had resigned from BSE for personal reasons. Retired SunTrust Bank executive Bill Serravezza, whose name also had been tied to BSE, declined to comment. Other participants, including Ray Christman, a former head of the Federal Home Loan Bank of Atlanta, and John Ryan, a former Office of Thrift Supervision regional director in Atlanta, could not be reached for comment.
BSE had hoped to create a $2 billion fund to buy failed banks, but it may be concerned that the window for doing bargain-basement deals is closing. Private investor groups have made inroads in the mergers-and-acquisitions market for failed banks, but structuring the firms in a way that would pass muster with regulators has taken time. Meanwhile, markets have continued to thaw out and the Federal Deposit Insurance Corp. has been cutting shrewder deals, crimping potential rates of return.
Ticktock, Senator
Senators had a culture shock of sorts when they attended the first day of the conference committee to work out the final version of regulatory reform last week.
Most of the 12 Senate members hail from the Banking Committee, where their chairman, Chris Dodd, often politely indulges members in going over their allotted five minutes for opening statements. But House Financial Services Committee Chairman Barney Frank, who is chairing the conference, was not feeling indulgent.
As he typically does in the Financial Services Committee, he kept conferees strictly on schedule, irrespective of party or rank. For example, when Senate Agriculture Committee Chairman Blanche Lincoln went over her time limit, Frank began tapping the back of his gavel to warn her to wrap up. When she failed to take the hint, Frank, undeterred, kept tapping intermittently until she caught on and finished speaking, looking somewhat taken aback.
Frank had warned the 43 members of the committee when he accepted the chair role earlier in the day that he would not brook any delays. "I will put forward as a major qualification for this job my impatience. I think it will serve us all very well," he said.
But that did not mean Frank was unwilling to make accommodations. The Massachusetts Democrat let senators speak before House members so that they could return to their chamber for afternoon votes — a gesture Dodd thanked him for.
"I just want to thank our House colleagues for their generosity in allowing our colleagues to go forward," the Connecticut Democrat said. "I know how warmly the affection for the United States Senate is on the House side."
Without missing a beat, Frank deadpanned, "I think, Senator, my colleagues generally feel that anything that would allow members of the Senate to leave would be warmly supported."
The Long Goodbye
Outgoing Federal Reserve Board Vice Chairman Donald Kohn is extending his stay at the central bank until his successor is confirmed.
Although Kohn announced plans in March to resign when his term expired on June 23, Fed Chairman Ben Bernanke asked him to delay his departure. The Fed said he will leave no later than Sept. 1. The White House nominated Janet Yellen, the president of the Federal Reserve Bank of San Francisco, in April to succeed Kohn, but the Senate Banking Committee has not yet held a confirmation hearing.
Falcon's New Post
Armando Falcon Jr., the former top regulator for Fannie Mae and Freddie Mac, has joined the American Securitization Forum as a senior policy adviser.
Falcon, the chairman and chief executive of Falcon Capital Advisors, will be advising ASF on a range of issues, including reform of the housing finance system. From 1999 to 2005, Falcon served as director of the Office of Federal Housing Enterprise Oversight, the former regulator of Fannie and Freddie.
