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FDIC Launches Program to Sell Failed Bank Assets Faster

Amid national bank failures that recently ticked up to 70, the ""FDIC"":http://www.fdic.gov/ announced Friday that it will stand up a new networking platform that seeks to make it easier for small investors to take a slice of the pie from assets under failed banks. The federal agency cast the program as a way to increase the efficiency with which it sells off assets from failed financial institutions.


The platform, titled the Investor Match Program, will identify and recommend match-ups between investors and asset managers by linking comparable identifiers from one firm with those from another. Agency personnel will connect the dots in possible pair-ups by synthesizing the information in a customizable database.

The FDIC takes the assets left in the wake of a bank failure and sells the equity stake to qualifying investors.


The approach allows the agency to maintain a stake in the funds and catch an updraft from the investments, with assets that often range from hundreds of millions of dollars to over a billion dollars, according to the agency.

Commenting on the program, Pamela Farwig, deputy director of resolutions and receiverships, said in a ""statement"":http://media-newswire.com/release_1158397.html that the new way forward ""is an example of our commitment to ensure that the structured sales transaction process is inclusive of all firms large and small. We believe that expanding the investor pool will assist in minimizing losses to the Deposit Insurance Fund.""

She called likened the program to a strategy that ""will leverage technology to more effectively dispose of assets that the FDIC has inherited through failed bank receiverships.""

The federal agency dubbed the Investor Match Program ""part of a larger effort to expand outreach efforts with small investors"" in the statement.

There are restrictions: only pre-qualified investors are able to make bids for assets stemming from failed banks.

To receive approval, investors must qualify by registering at the ""Web site"":http://www.fdic.gov/buying/financial/investormatchprogram.html for the Investor Match Program. After giving an investor the green-light, the FDIC will notify the individual by e-mail that it is permissible to participate in the program.