Blackstone President Jon Gray offered more detail about his company's evolving discussions with regional banks on Thursday, telling the Financial Times that under any such partnerships, the investment giant would steer loans originated by the regional banks to insurance companies that Blackstone already has relationships with.

That would include real estate and other commercial loans, Gray said, noting that the regional banks themselves are in the best position to decide to whom they should lend. He did, however, note that groups like Blackstone can be a "valuable partner" that helps relieve some of the risk when a loan is securitized.

“Rather than putting all [of the risk] on its balance sheet, maybe they keep 50 cents [on the dollar], and put 50 cents with us,” Gray told FT.

Blackstone would thus essentially function as a middleman between regional banks and insurance companies eager to invest in debt. For its services, Blackstone would collect fees from its insurance company clients.

“What’s really changed from our standpoint is that we have a very low-cost capital because of our insurance clients,” Gray told the publication.

Gray first broached the potential partnerships in April when he mentioned Blackstone's discussions with regional banks during the company's earnings call. He didn't specify any particular banks then, and his recent comments didn't either, though he did say the banks Blackstone is working with have between $100B and $250B in assets.

“As regional banks experienced outflows of deposits, we are seeing real-time opportunities to partner with them at scale,” Gray said at the time. He also noted that regional banks provide “a meaningful portion of U.S. construction lending.”

The regional banking sector has been jittery since the failure of Silicon Valley Bank and Signature Bank, and more recently, First Republic Bank, as those institutions didn't cope well with quickly rising interest rates.