The Real Deal New York

FDIC enters CMBS market

April 21, 2011 12:38PM

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The Federal Deposit Insurance Corp. has made its first foray into the commercial mortgage-backed securities market, the Wall Street Journal reported, by selling off about $400 million worth of commercial loans divided into bonds. Real estate investor LNR Property scooped up the riskiest layers of the bonds, originally collected from 13 failed banks. Traditionally the FDIC sold loans mostly in the form of distressed mortgages but with increasing demands for CMBS the agency wants to get into the act. The federal government actually pioneered the CMBS market in the early 1990s when the Resolution Trust Corp. sold off commercial mortgage bonds in an effort to get rid of its portfolio. [WSJ]

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