A Boston-based company will be helping federal regulators sell $154 million in commercial loans left behind by First Priority Bank of Bradenton.
First Priority was shut by regulators in August after its nonperforming loans grew out of control.
DebtX announced Tuesday it had been contracted by the Federal Deposit Insurance Corp., which is the receivership for the loans, to dispose of the assets through a bidding process.
Greg Berardi, spokesman for DebtX, said the loans will be shopped to hedge funds, opportunity investors and other financial institutions.
DebtX has about 4,000 registered and screened buyers for loans like those belonging to the former First Priority.
"These are basically sophisticated institutions and investors," Berardi said. "This is not a Craigslist for loans. This is a functioning exchange."
David Barr, spokesman for the FDIC, said DebtX was chosen through a bidding process to fulfill the job of recouping outstanding assets from First Priority that will be used to reimburse depositors who had uninsured deposits.
Barr said using a company like DebtX was more efficient than the FDIC taking on additional personnel to do the job on its own.
"It's just easier to shift it to a contractor and have them specialize in it," Barr said. "They've got the expertise, they've got the learning curve and the personnel at their disposal."
First Priority had $43 million in nonperforming loans at the time it was closed. The bank only had left a mere $1.5 million in base capital.
The bank's insured deposits were assumed by SunTrust.
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