Bloomberg’s Miles Weiss reports that Michael Cagney, a hedge-fund manager backed by
China’s largest social-networking website, is starting a series of funds to
help students at Ivy League and other top U.S. colleges refinance their loans
at lower rates.
Cagney has registered SoFi (Social Finance) Capital Advisors
LLC with the U.S. Securities and Exchange Commission to manage funds that will
finance loans at top colleges, including six members of the Ivy League. Each of
the 18 funds will be dedicated to one school and will seek money from
institutional investors as well as alumni of that school, according to company
officials and regulatory filings.
The firm plans to offer investors returns that are a
multiple of the 3.97 percent yield they would currently get from comparable
investment grade corporate bonds. Social Finance will offer lower interest
rates than the federal government and many banks while seeking to minimize
defaults by focusing on top schools and having students borrow from their own
alumni through funds set up specifically for their school….
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