FDIC Chairman Sheila C. Bair said, “It has been clear for some time that troubled loans and securities have depressed market perceptions of banks and impeded new lending. Difficult market conditions have complicated efforts to sell these troubled assets because potential buyers have not had access to financing. The Legacy Loans Program aligns the interests of the government with private investors to provide financing and market-based pricing, and is a critical step forward in the process of restoring clarity to the markets. While there are inherent challenges to implementing a program of this magnitude quickly, the framework announced today provides the foundation upon which the FDIC will begin to build immediately.”
“The FDIC intends to move forward with this program in a methodical and transparent fashion. We will provide the opportunity for public comment on critical aspects of the program prior to implementation.”
“Today’s actions demonstrate the strong commitment of the FDIC, Fed, Treasury and the Administration to use creative and innovative programs to address the serious economic issues facing our country. The Legacy Loans Program, while providing substantial upside potential to private investors and the government, will also clear these troubled assets from banks balance sheets – enabling them to lend and restore economic growth.”