FDIC Taps BlackRock to Sell $13B in Mortgage Bonds from Collapsed Lenders

U.S. government looking to sell nearly $13 billion of mortgage bonds acquired from failed lenders Silicon Valley Bank and Signature Bank
Bonds were part of $114 billion in assets FDIC took over when the lenders collapsed
Bonds backed by long-term, low-rate loans made primarily to developers building affordable housing
FDIC hired BlackRock to sell securities portfolios of the failed lenders
Mortgage bonds have proved difficult to sell in initial discussions with investors

reuters.com

Relevant topic timeline:

3/13/2023

The End of Silicon Valley (Bank)

The main topic is the recent bank run on Silicon Valley Bank and its implications for the future of Silicon Valley. Key points: 1. Silicon Valley Bank's shift to longer-term securities in search of higher yield was a critical mistake. 2. When interest rates rose, fewer deposits came in and the market value of securities plummeted, leading to insolvency. 3. The bank run was triggered by a rushed capital raise and the perception that the bank was insolvent. 4. The federal government stepped in to protect depositors and ensure the stability of the banking system. 5. The loss of trust and increased uncertainty may lead to more government intervention and tighter regulations, impacting innovation in Silicon Valley.

8/22/2023

Banks Loading Up on Cash Fuel a Record $2 Trillion Bond Spree

Global financial companies have sold $2 trillion worth of bonds in a record amount of time this year, with European lenders paying off central bank loans and Chinese firms strengthening their balance sheets amidst economic uncertainty.

9/5/2023

FDIC Starts Marketing $33 Billion of Signature Property Debt

The Federal Deposit Insurance Corp. is seeking buyers for $33 billion of commercial property loans from Signature Bank, with a majority being backed by multifamily properties in New York City, as part of its efforts to offload debt from the collapsed bank.

10/6/2023

Bank of America Forecasts Slight Increase in Municipal Bond Sales in 2024 Despite Higher Rates

Bank of America is forecasting that $400 billion of state and local bonds will be sold next year, which is slightly higher than this year's sales.

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Posted 9/12/2023, 10:11:00 PM