Firms Line Up to Invest in PPIP, Treasury Taps Managers

Private capital firm Paramax and Maria Fiorini Ramirez, a firm providing independent economic forecasts, teamed-up to target investment opportunities within the US Treasury’s Public-Private Investment Program (PPIP). “Successful execution of PPIP could help to unfreeze the credit markets and jumpstart the recovery of the housing finance sector,” said Paramax CEO Gordon Baird, who believes investment PPIP is an opportunity for the newly formed group to play a significant role in the recovery process. The group joins the ranks of more than 100 firms that hope to participate in the investment program. The PPIP, announced in late March, aims to stimulate more private capital investments in order to generate some $500bn in purchasing power to buy toxic assets. The program faced somewhat of a makeover in early April as the Treasury Department updated guidelines “to better accommodate increased participation.” In addition to extending the application deadline, the Treasury said the criteria would be considered “holistically.” In other words, the Treasury will not automatically throw out a proposal that doesn’t meet all the requirements. Paramax, one of the first participants in the Treasury’s TALF funding program, invested in or financed over $17bn in mortgage and credit related assets. The firm’s management team underwrites and manages more than $70bn in PPIP-eligible assets. Paramax also uses long-term private capital for buy and hold strategies – the type of capital ideally situated for investing in the PPIP and other financial sector assets, Paramax says. In other reports today, media outlets say the Treasury is expected to notify a group of asset managers that they were picked to oversee the first wave of public-private investment funds. The selected firms will likely include BlackRock and Allianz SE’s Pacific Investment Management. Write to Kelly Curran.