The New York Federal Reserve lost $180 million in a debt reorganization this year that was undertaken to avert financial difficulties at Hilton Hotels Corp., the Financial Times reported, citing unidentified people close to the matter.
Toxic assets taken on by the central bank from Bear Stearns, the investment bank that was bought by JPMorgan Chase & Co. during the financial crisis, included $4 billion of loans that had helped to finance Blackstone Group LP’s 2007 leveraged buyout of Hilton Hotels, the newspaper said.
In April, Blackstone renegotiated the Hilton debt, buying back $1.8 billion of it at a steep discount; that meant the New York Fed incurred a 56 percent loss on $320 million of debt, the FT said.
Glad JPM got all the good assets. So I guess each taxpayer spent $500k for their stay at the Hilton. Feel rested?
This is my effort to help fit the pieces together to get a better picture of the capital markets.
“It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”
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