Private equity firm Blackstone Group LP (BX) is in preliminary talks to raise $1 billion to buy failed banks from the Federal Deposit Insurance Corp., according to media reports on Wednesday.
The New York-based firm is said to be working with Brad Oates, a former president of Bluebonnet Savings Bank Fsb Inc. who led the Dallas-based thrift's turnaround amid the savings and loan crisis, to raise the funds for a blind pool. Blind pool investors usually back a single management team without having a say in what company it will acquire.
Oates has experience operating assets acquired from the Resolution Trust Corp., set up by the federal government in the late 1980s to resolve failed savings and loan companies. He served at Bluebonnet Savings from 1988 to 2003. Oates, 57, currently serves co-managing partner of Stone Advisors LP, a Dallas-based turnaround advisory firm. He also is engaged as a contractor by the FDIC to assist in resolving bank receiverships, according to CIT Group Inc. (CIT), which named Oates an independent director in December.
In Bluebonnet's early years, Oates steered the bank through legal difficulties that the bank's owner James Fail got into with regulators. Bluebonnet later merged with Texas Capital Bank in 2003.
During the last few months, Blackstone is said to have held preliminary talks with investment banks, including Deutsche Bank AG (DB) and FBR Capital Markets, about potentially awarding a mandate for raising capital. However, neither bank is currently working with Blackstone.
Buyout firms are seeking bargains as lenders fail at the fastest pace since 1992. In 2009, the total number of bank failures was 140, the highest annual tally since 1992 amid the height of the savings and loan crisis.
In late February, the Federal Deposit Insurance Corp. or FDIC reported that more than 700 U.S. banks appeared on the government's list of troubled lenders in the fourth quarter of 2009. Federally insured banks posted $915 million in profits during the fourth quarter, but the number of institutions under scrutiny for risk of failure also rose.
BX closed Wednesday's regular trading session at $14.65, up $0.22 or 1.52% on a volume of 3.03 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.