National Press Club

Private Equity Exec Outlines Plan to Plug Lending Gap

October 19, 2009 | By Jamie Loftus | jloftus@dcigroup.com

A private equity executive outlined her plan to revive lending to small and middle market companies at an Oct. 15 Newsmaker.

Lynn Tilton, CEO of Patriarch Partners, said that her public-private investment proposal would plug the lending gap while faltering banks recover.

The plan would utilize unused TARP funding to encourage qualified private investors to provide rescue financing to companies shut out of bank loan or credit markets.

Tilton said that the program would help the small and medium-sized businesses that employ a majority of Americans while protecting the country's manufacturing
base during the current lending drought.

Failing to provide the working capital loans to the small business sector will lead to the "loss of industrial knowledge," Tilton said.

Her firm manages a $6 billion portfolio specializing in turning around distressed small and medium-size companies.

Tilton is discussing her proposal, which she said will revive lending, save jobs and hasten the economic recovery, with Treasury officials and members of Congress. She said she has a unique understanding of the mood of the country after visiting companies in manufacturing towns across the nation.