DEFINITION of 'Public-Private Investment Program For Legacy Assets - PPIPLA'
A program designed as a result of the implementation of the trouble asset relief program (TARP). It is designed to help alleviate some of the strain caused by the existence of legacy assets on banks balance sheets. With too many of these assets, banks begin to have difficulty attracting investors, and are unable to issue credit to customers at the required rate. The plan is directed at ridding banks of legacy loans and legacy securities, and to sell the legacy assets to both private and public investors who will share in the risk as well as the profits.
BREAKING DOWN 'Public-Private Investment Program For Legacy Assets - PPIPLA'
In order to maintain a fair selling price, each institution decides which assets to sell, but competing private investors will decide the selling price. With proper implementation of this plan, banks will again be able to issue credit, ultimately leading to an increased purchasing power for every American dollar.