Different investment funds have been set up to take advantage of investment opportunities presented by the U.S. Treasury Departments Term ABS Loan Facility (TALF).
Paramax Capital Partners launched a new investment management initiative geared toward the attractive investment opportunities offered by TALF as well as other related government asset and liquidity programs, according to a release from the firm.
Paramax, which was one of the first firms to participate in fundings through the TALF program, announced it would launch two new funds, which are related to the management initiative.
The funds will be open to outside investors and are expected to raise $100 million each. These will be investing in TALF-eligible securities and investors will be able to participate in the TALF funds directly or through separate accounts.
The funds investment activities will be led by Tom Dial, Jeb Ebbott and Al Hageman who formerly had senior roles at firms including Citigroup, Bear Stearns and Lehman Brothers.
According to the release, the firm has invested in developing the infrastructure and personnel needed to sponsor and manage TALF and related investments. It will continue to participate significantly in Treasury-sponsored programs as long as the programs continue to be designed and implemented in a way that is attractive to private sector participants.
The TALF program has the potential to revive vital securitization markets and increase the availability of consumer credit in this country, while also creating attractive investment opportunities for institutional and other investors, said Paramax Chief Executive Officer Gordon Baird. Paramax anticipates being an active participant in the TALF program.
Separately, published reports said that ABS investor Princeton Advisory Group is opening a fund that will invest in securities eligible under TALF as indicated by the firm's letter to investors.
The reports said that the Princeton ABS Fund has already received between $10 million and $15 million in seed funding. The fund will invest in TALF-eligible securities as well as seek annual returns of between 12% and 16%. The letter, which was signed by President and Chief Investment Officer Munish Sood, cited the "attractive financing," available under TALF, according to the published reports.
Princeton Advisory Group, which has $8 billion in ABS and MBS under its management, said it expects the fund to invest in TALF-backed securities for three-to-four years, according to the reports. The company called itself a "100% active employee- owned" investment advisor.
Meanwhile, various news reports have said that PIMCO plans to launch a closed-end ABS fund linked to TALF in the next month or so. Other firms Aladdin Capital Management, Seer Capital Management, and Princeton Advisory Group are also said to be prepping funds to take advantage of TALF.