Only 18 months ago, developer and Related Companies Chairman Stephen Ross thought U.S. banks were a wise investment. Now, it seems, he’s changed his mind.
According to the Wall Street Journal, Ross and partners Jeff Blau and Bruce Beal each put $100 million of their own money, in addition to $1 billion raised from investors, into a fund called SJB Escrow Corp. in 2009, and spent a year researching U.S. banks, hoping to buy or invest $1.1 billion in lenders. The deeper they looked however, the more worrying things became; they saw troubled assets, weak loan demand, rising regulatory costs and few growth prospects.
“We’re disappointed to see the opportunity evaporate,” Ross said. “If you look at the environment today, I feel even more comfortable that we made the right decision [not to invest].”
Blau added: “It was a lot of work, and it was hard to make the numbers work.” [WSJ]