HoldCo Targets Underperforming US Banks

Okay, here’s a breakdown of the key data about HoldCo and its founders, Ghei and Zaitzeff, based on the provided text:

HoldCo & Its Founders:

* ⁤ Founders: samir Ghei ⁣and Ilya Zaitzeff. They met at Tricadia Capital,another hedge fund.
* Formation: Founded in 2011, starting with “crummy offices” in New York’s Financial District. The ‍name “HoldCo” came from thier initial ⁢strategy of acquiring debt from failed holding companies.
*⁢ Relationship: ⁤They are described as close friends who⁢ spent a critically important amount of time (14 years) working together, ‍frequently enough to ⁣the ⁣frustration of their wives. They emphasize a collaborative, non-personal approach to investment debates.
* Investment Style: “Go-anywhere” – they seek out⁤ distressed debt and ‍situations were they believe the market is mispricing ⁢risk. They are described as “scrappy fighters.”

Early Career & Strategy:

* Backgrounds: Ghei previously worked at Goldman Sachs. Zaitzeff is a⁢ Brown University computer science graduate who specialized in modeling subprime CDOs.
* Subprime CDOs: Both had experience with subprime collateralized debt⁢ obligations (CDOs) – even ‍profiting from both creating them ⁢ and betting against them (like those described in “The Big Short”).
* Early success: They initially focused on bonds from failed banks, believing⁢ assets like tax refunds were undervalued. They successfully fought the FDIC in court to claim these assets.
* Fundraising: Started ⁢with a single endowment investment in 2013, and ⁤grew to manage funds ‍from about 20 universities, hospitals, and family offices.

Notable Investments & Actions:

* First NBC⁤ Bank (New Orleans): In 2016,they invested in the distressed debt of First NBC Bank,a bank established to help rebuild New ⁤Orleans after hurricane Katrina.
* Shorting & Exposing First NBC: They shorted the bank (bet against it) after realizing it was ⁤undercapitalized and publicly revealed their concerns. This led to the auditor resigning and the FDIC seizing the⁢ bank.
* First NBC Outcome: ⁤ The former CEO of First NBC, Ashton Ryan, was sentenced to 14 years⁢ in prison for bank fraud in 2023.
* View of Bank Management: Their experiences,⁣ like⁢ the First NBC situation, reinforced ⁢their skepticism about bank management.

In essence, holdco is a hedge fund built on identifying and capitalizing on distress, notably in the financial sector, with a willingness to challenge established institutions and a strong belief in their own analytical abilities.