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Ross: Bullish on Buying Bank Assets

By Dan Weil   |   Monday, 13 Jul 2009 08:13 AM

Billionaire investor Wilbur Ross expressed enthusiasm for the government’s plan to rid bank balance sheets of toxic securities via the Public-Private Investment Program.

His Invesco firm was one of nine chosen by the U.S. Treasury to buy those assets. Invesco plans to purchase both residential- and commercial-backed mortgage securities.

"We're quite excited about the program. We think it's the right thing for the economy and … for our investors," Ross told CNBC.

Invesco has $700 million to commit to the program, which will include contributions from the Treasury and may total $40 billion.

“As soon as the banks become willing to sell, we would be prepared to bid,” Ross said.

“We already have funding in place to get going.”

He sees three categories of banks as most likely to sell: The 77 banks seized by federal regulators, banks that have received government money and still are in terrible shape and banks that received government money and are trying to pay it back.

Ross declined to specify the level of returns he expects on his investments. But, he said, "The fact that I'm committing private equity capital is an indication that we think there will be respectable returns."

Not everyone is so enthusiastic. “My initial concern is that institutional investors will be a lot more cautious signing up,” Eric Petroff of Wurts & Associates, a consultant to institutional investors, told Bloomberg.

“The mosaic is more complicated and the expected returns are less clear” than other government programs, Petroff said.

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Billionaire investor Wilbur Ross expressed enthusiasm for the government’s plan to rid bank balance sheets of toxic securities via the Public-Private Investment Program.His Invesco firm was one of nine chosen by the U.S. Treasury to buy those assets. Invesco plans to...
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