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The Securities Industry and Financial Markets Association’s (SIFMA) president and CEO and a former manager of the savings & loan clean-up, Tim Ryan, today said the following:
“We are encouraged by the creative and wide-reaching suite of programs outlined today which are designed to restart our frozen banking system. We look forward to seeing full details on each of the individual plans.
“It appears as though the Obama Administration is wisely applying some of the most important lessons learned during the S&L crisis, using public-private joint financing to encourage the return of private investment. That capital will be the cornerstone to reestablishing a healthy market, especially if those purchases are made openly and transparently. When additional details are provided, we hope the administration will include methods for the public and private sectors to share upside profits and downside risk, another successful approach used during the S&L crisis which both brought back private sector buyers and limited taxpayer losses.
“The dramatic expansion of the Term Asset-Backed Securities Loan Facility (TALF) should also provide a crucial bridge for average American consumers and businesses, ensuring they can get the loans they need, until the larger financial markets can be brought back to health.
“Home foreclosures remain at the center of our troubled economy, and we welcome further details that provide smart methods for more quickly and efficiently modifying loans to keep Americans in their homes.
“By choosing convertible preferred shares to compensate taxpayers for their government-led investment, Treasury has designated an investment instrument that will also encourage the return of private capital, which is vital to the long-term health of the system.”
In addition to his current role as an industry representative, from 1990-1993, Tim Ryan was a principal manager of the savings and loan cleanup which involved closing approximately 700 insolvent institutions, improving capital bases and selling over $300 billion of assets. During that period, he was the Director of the Office of Thrift Supervision, U.S. Department of the Treasury, and as OTS Director, he served as a Director of the Resolution Trust Corporation and a Director of the Federal Deposit Insurance Corporation.
