Billionaires took private and forgive-able public loans in March. Private loans enabled market beating returns on their wealth while public money subsidized operations in some firms. Reuters reported:
Billionaires looked after by Swiss bank UBS (UBSG.S) are looking to move some of their cash out of equities after profiting from an unprecedented sell-off and rapid rebound from March to May, the world’s largest wealth manager said on Thursday.Some high return family offices took Paycheck Protection Program funds. Reuters reported:
During the rout in stock markets across the globe in March, UBS’ richest customers took out loans to place billions into crashing stock markets. They are now looking to pull that money from equities and put the profits in illiquid and private assets, UBS’ head of global family offices told Reuters.
Their strategy has helped family offices which manage the financial affairs of the world’s richest beat hedge funds and overall markets to outperform their target benchmarks through May, according to the bank’s survey of 120 family offices, with an average family wealth of $1.6 billion, published on Thursday.
Private investment firms that manage the fortunes of wealthy individuals and their kin were approved for millions of dollars in taxpayer-funded relief loans designed to help small businesses weather the coronavirus lockdown.
The companies - often referred to as “family offices” - approved for the forgivable loans from the Small Business Administration (SBA) included those that oversee money for the family that co-owns the National Basketball Association’s Sacramento Kings; the former manager of a multi-billion dollar hedge fund firm; and a serial Las Vegas entrepreneur.
About 2,000 firms that manage money or advise on investments, such as hedge funds or wealth advisers were approved for loans meant to shore up payroll and rent costs for small companies.
The SBA said in a report, finance and insurance firms represented $12.2 billion across 168,462 loans, about 2.3% of the program’s total lending as of June 30.So the Trump team pushed millions out the door to people with the wherewithal to borrow huge amounts. Many founding private equity underwriters (PEU) formed family offices with the vast wealth. It's not clear if any of these offices took forgivable PPP loans while making big bets on equities.
Some recipients include:
Rothschild Capital Partners LLC, a New York-based firm that manages money for its chief executive, David D. Rothschild and others, got the go-ahead for a loan of up to $350,000 to retain eight jobs. The firm managed approximately $330 million at the end of 2019 on behalf of the Rothschild family and a group of wealthy investors, according to public filings. Representatives for Rothschild did not respond to requests for comment.
The family office of former high-profile hedge fund manager Jacob Gottlieb, New York-based Altium Capital Management LP, was also approved for up to $350,000 to retain eight jobs, according to the disclosure. Gottlieb until recently ran the approximately $8 billion Visium Asset Management before it shut down amid a financial fraud scandal