FDIC To Gradually Auction $114B In MBS Seized From Failed Signature Bank and Silicon Valley Bank
The FDIC has decided to sell a portfolio of $114 billion in mortgage-backed securities (MBS). The FDIC seized control of the MBS portfolios after taking control of Signature Bank and Silicon Valley Bank.
The face values of SVB’s portfolio is approximately $87 billion. Where as Signature Bank’s assets are valued at $27 billion. The portfolios consist primarily of agency and commercial MBS. In addition, the portfolio also contains collateralized mortgage obligations.
BlackRock Financial Market Advisory will conduct the portfolio sale. The FDIC aims to minimize the potential for any adverse impact on market.
SVB collapsed on March 10th marking the biggest bank failure since Washington Mutual in 2008. The FIDC took control of the bank and named Tim Mayopoulos as CEO of the “bridge bank” meant to protect all depositors.
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