Conference Call With Team SheBair


There is an FDIC Conference Call for Bankers (and Investors now) discussing Legacy Loans Program under the newly announced Public Private Partnership, scheduled for noon.
Passcode: 9857969

11:51: The hold music is...Tears In Heaven.
11:55: Now it's the theme song from Trading Places ("Overture, Marriage of Figaro"). No joke.
12:06: Bair: "We don't have all the answers now, so we want to hear from you. Put your thinking caps on."
Franklin Card: In terms of starting the program, do you have a time range for when you hope to be up and running? A month? Couple months?
FDIC: Not before we get public comments. We put a end date on that of April 10. We're anxious to get it moving as quickly as possible. We need the input before we give a specific time frame.
Card: Is price discovery here going to impact accounting treatment for similar assets?
FDIC: Only if there are enough transactions to give several data points, and you have to remember that the leverage distorts the pricing to some degree.
Missed questioner's name: Will participating in the program potentially put a hole in capital to the extent we have to remark assets? How will this effect our regulatory capital requirements? Will the requirements be changed to alleviate this problem?
FDIC: Uh... maybe.
Missed questioner's name again: Will the FDIC, I don't want to use the word 'coerce', but use this to nudge the bank along to sell the assets?
FDIC: The supervisory process is already there.
Guy: Can you give us a headcount of people you have devoted to this?
FDIC: No, next question.
'Nother Guy: Has it been determined if there are bidders, and what the qualifications are to bid?
FDIC: We're soliciting comments on that. There will be qualifications.
Dude from JPMorgan: breathing into phone
Operator: Sir, your line is open.
Dude from JPMorgan: Hello? Hello? Hello?
Operator: Sir, your line is open.
Dude from JPMorgan: Hello?
FDIC: We're here. Ask your question.
Dude from JPMorgan: Sorry, I'm an analyst at JP Morgan who doesn't know how to use a phone.
Guy from DE Shaw: What level of interest have you seen from the banks to participate in this process so far. If you're not seeing a lot of participation, will you force people to?
FDIC: We just started this monday so...but yeah, people have told us they're interested.
RBC Capital Markets: Will unaccepted bids impact mark-to-market marks?
FDIC: Depends.
RBC Capital Markets: If not enough banks want to get involved, is there something you can do to force encourage them to?
FDIC: We're seeking comment on that.