US regulator slammed over Signature Bank loan sales - reports

investmentweek.co.uk:

Signature Bank became one of several US regional banks to collapse in March following the failure of Silicon Valley Bank, leaving the FDIC to auction off $33.2bn of its loans.

Investment group Brookfield Property Group has accused the FDIC of running a «secret» process to sell the failed bank's loans at cheap prices, in a letter seen by the FT.

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In the letter, Brookfield said that it had heard from «numerous sources» that a winning bidder for the loans had been selected, and that the bid had been lower than that made by the firm.

The firm then threatened to file a formal protest of the auction, which is expected to be completed this month.

Signature Bank became one of several US regional banks to collapse in March following the failure of Silicon Valley Bank, leaving the FDIC to auction off $33.2bn of its loans.

Brookfield had been bidding on $4.4bn in affordable housing loans in New York City, offering over 80 cents on the dollar, according to the letter.

However, a group led by Related Fund Management has won the auction at less than 70 cents on the dollar, according to reports from The Wall Street Journal.

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«If the winning bidder's price is in fact lower than ours, as it appears to be, we intend to launch a formal protest, as we believe that this would be in violation of law,» Brookfield Property Group chief investment officer Lowell Baron said in the letter.

The letter also claimed that the FDIC had indicated it would not assign a preference to bidders, regardless of political support or work with non-profits.

"[Once] a bidder had been qualified and cleared to