Private Equity Group To FDIC: Try Again
The Private Equity Council isn't going to let federal regulators off so easily this time around. Last month, the private equity lobby supported the government's requirement that buyout firms register with the SEC, even while arguing that "private equity firms do not create systemic risk." Today, however, the PEC came out against proposed FDIC guidelines for buyout firm investments in banks, saying that they go to far and would be counterproductive. "We hope that the comment period yields changes that facilitate the flow of private capital into the banking system, consistent with the Administration's other efforts to address the financial crisis," said PEC president Doug Lowenstein. To recap, the proposed rules include a minimum three-year hold time, capitalization requirements, cross-guarantees for firms with multiple banks in its portfolios, and extensive disclosures, particularly regarding ownership structures.
