Yesterday, the FDIC announced that it was preparing for the sale of the $60 billion loan portfolio it retained in receivership following the failure of Signature Bank.
The portfolio consists primarily of commercial real estate (CRE) loans and commercial loans, and a smaller pool of single-family residential loans, and includes a concentration of multifamily properties in New York City. The FDIC anticipates that the marketing of the loan portfolio will begin later this summer. Newmark & Company Real Estate, Inc. (Newmark) is serving as the loan sale advisor.
The FDIC announcement further explains its statutory obligations as receiver include an obligation to maximize affordable housing for low- and moderate-income households. As a result, it is currently reviewing the CRE loans secured by multifamily residences that are rent stabilized or rent controlled, and plans to seek input from state and local government agencies and community-based organizations on the FDIC’s marketing and disposition strategy.
Prospective purchasers must meet certain requirements in order to be eligible to bid, and must submit an executed Purchaser Eligibility Certification to the loan sale advisor as a prerequisite. The point of contact for more information on the sale and qualifications to participate is NewmarkSBBPortfolio@nmrk.com.
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Clients with questions should reach out to any of their regular contacts at Cleary Gottlieb or any of the partners or counsel listed on our website under Banking and Financial Institutions, Real Estate or Bankruptcy and Restructuring.
Additional Cleary Gottlieb content regarding SVB, Signature Bank and related developments can be found here.
Cleary Gottlieb is a trusted resource in the financial sector for clear and up-to-the-minute guidance on the evolving regulatory landscape. Our preeminent banking and bankruptcy and restructuring practices have been intimately involved advising the private sector and governments in times of crisis, including the 2008 financial crisis and in the federal government’s actions to stabilize the economy during the COVID pandemic. We have extensive experience advising banking institutions and their depositors, creditors, and investors through the FDIC resolution process.