Tuesday, December 14, 2010

Agency Raises Capital

FDIC Plans to Sell $1 Billion of Bonds Tied to Real Estate

By Jody Shenn - Dec 13, 2010, Bloomberg

The Federal Deposit Insurance Corp. plans to sell almost $1 billion of securities tied to residential and commercial real-estate debt once held by failed banks, according to a person familiar with the transaction.

The agency is selling guaranteed notes backed by the debt, said the person, who declined to be identified because the transactions are private.

The FDIC is offering bonds from three securitizations through Barclays Capital, the person said. Two are tied to residential debt, and total $160.2 million and $135.7 million, the person said. An additional $679 million of bonds are tied to commercial-property debt, the person said.

In March, the FDIC began raising cash through the bond market for the first time since the early 1990s. The Washington- based agency’s completed sales this year have totaled more than $4.15 billion, according to data compiled by Bloomberg.

David Barr, a spokesman for the FDIC, declined to comment, saying any possible bond sales would be considered private placements.

“The FDIC’s position on such private placements is to not comment or confirm the marketing of them,” he said.

Informa Global Markets reported on the deals earlier today.

To contact the reporter on this story: Jody Shenn in New York at jshenn@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net