2. FDIC: It will oversee formation, funding, operations of new PPIFs. It will also oversee and manage debt guarantees. PPIF: It will purchase troubled and illiquid assets from insured banks / thrifts. It will adopt a โbuy and holdโ investment strategy. Private Investors (PI): Pre approved by FDIC for the Auction. It can be financial institutions, individuals (minorities & veterans, preferred), insurance companies, mutual funds, investments funds, pension funds. Participant Banks: It includes any insured US or US savings association. FDIC & UST will determine eligibility. PARTICIPANTS
3. PPIF Private Investors provide Equity Component UST provide Equity Component, but has no Control Rights FDIC provides Debt Component in lieu of Debt Guarantees issued by PPIF, which are secured by the assets purchased by PPIF INVESTORS
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5. FDIC Debt PI UST Third Party Valuation Firm Max 6/7 Leverage to Bid Value 1/6 Equity PPIF FDIC Consideration for Asset purchase paid in $ or Debt issued by PPIF Debt Service Coverage Account maintained by PPIF, which is retained out asset purchase payments Participant Bank + Primary Bank Regulator jointly evaluate and identify Eligible Assets from Eligible Asset Pool, which are later sold to PPIF Administrative Fees to FDIC, Debt Guarantee Fee based on outstanding Debt balance paid to FDIC & Debt Insurance Fund
