By Al Yoon
The Federal Reserve Bank of New York on Monday said it plans to sell
$828 million of mortgage debt securities this week as it continues to
wind down a portfolio taken on during the 2008 bailout of American
International Group (AIG).
The New York Fed will accept bids on four groups of securities backed
by commercial and residential mortgage bonds on Thursday, according to
a notice on the bank's Web site. If the bids are accepted, it would
bring total sales from the portfolio to about $27.5 billion.
Dealers have been furiously competing for Maiden Lane assets to resell
to investors, defying forecasts earlier in the year that sales would
overwhelm demand as they did in 2011, when auctions of residential
mortgage bonds from another Maiden Lane portfolio coincided with
rising fears of the destabilizing impact of excessive Europe and U.S.
debt.
This year, both residential and commercial mortgage bonds have been
buoyed by the intensified search for yield and amid mounting signs
that the housing market has reached a bottom.
-Write to Al Yoon at albert.yoon@dowjones.com
(END) Dow Jones Newswires
July 09, 2012 12:02 ET (16:02 GMT)
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