Are investment bankers the right disposition channel for banks?
From Globe St. I think we’ve seen this approach in the past and the same thing usually ends up happening. After the initial shot at finding a buyer for the loans in bulk, the bank realizes that the bulk price on a pool like this is 30 cents on the dollar if the assets are really desirable, and a lot lower if the assets are not attractive. So rather than packaging the loans the bank will take the offering off market and then come back and offer the assets individually. Real Estate investment bankers typically have connections to large funds and institutional sources that many commercial brokers do not (though there are obviously a lot of commercial brokers that do have the connections to these same sources). But that means that they are necessarily selling in bulk, which is not the way to maximize value (ask Costco whether selling more ends up in higher prices). This method of disposition basically means that you are simply selling distress. The investment bankers do not typically have
