Lynn Tilton's Plan to "End the Plague of Joblessness" in America
By Aaron Task
December 15, 2009
"It's my personal mission to end the plague of joblessness in this country," says Lynn Tilton, CEO of Patriarch Partners.
Unlike many politicians, that's not just campaign rhetoric. Tilton's firm has over $7 billion in equity and direct investments with more than 70 companies employing about 250,000 Americans. Most of the those jobs would have disappeared if Patriarch hadn't stepped in with loans and investments to those companies during times of duress, she says.
In recent months, Tilton has talked with Treasury officials, elected officials and just about anyone else who'll listen about her plan to spur similar loans to distressed companies via a public-private partnership.
In simple terms, the plan calls for $40 billion of government funds already allocated for TARP plus $10 billion of funds from private investors to be leveraged into a $200 billion vehicle to provide loans to small- and medium-sized businesses. Tilton call this The SME Rescue Loan Program and you can find more detail here.
The program would provide "rescue lending... to those companies that have been rejected by banks that will otherwise liquidate if they can't get the basic working capital they need to keep their businesses running," Tilton says.
The plan calls for the private investors to take the first $150 million of any losses, and Tilton is willing to put her own capital to work, both important distinctions from the taxpayer-funded bailout efforts to date.
More importantly, Tilton says regulators "arenn't going to let [big] banks make these high-risk loans" and smaller community banks "don't have the energy, people and appetite" for this kind of distressed lending.
But such lending is critical since small- and medium-sized businesses employ over 80% of U.S. workers, she says. "If we continue to small- and medium-sized business to fail, we can never get people back to work in this country."
To read Lynn Tilton's bio click here About Lynn Tilton
Follow Lynn Tilton on Twitter at www.twitter.com/lynntilton
Watch video at SME Rescue Loans Youtube Channel