SIGTARP Generally Supports Treasury’s Selection of PPIP Fund Managers

This story appeared in Bank Digest.

A study by the Office of the Inspector General for the Troubled Asset Relief Program has found that the Treasury Department generally did a good job in selecting fund managers for the Public-Private Investment Program (PPIP), which was intended to “restart the market for legacy mortgage-backed securities.” The report approved of the process used to solicit and evaluate applications, but it did criticize some aspects of how the Treasury implemented its process. Three specific criticisms were raised: the initial selection criteria were confusing and not adequately clarified; the emphasis on the size of the fund manager applicants may have unnecessarily deterred applications from smaller fund managers; and there was not enough guidance on the expected roles of small, veteran-, minority-, and women-owned partners.