RTC to Sell $2 Billion of Mortgage Securities

The Resolution Trust Corp. said it plans to sell $2 billion in mortgage pass-through securities in October.

The bailout agency expects all the securities, which will be sold in four offerings, to be rated AA or AAA.

The mortgages backing the securities are all performing but generally do not conform to standards of the Federal National Mortgage Association or the Federal Home Loan Mortgage Corp., the RTC said.

First Deal Backed by Adjustables

The deals are being priced now. The first issue will be backed by $200 million of single-family, adjustable-rate mortgages originated by eight Texas thrifts and one institution in northern Virginia.

The second will total about $900 million and be backed by single-family, fixed-rate mortgages originated by 12 failed thrifts.

The third offering will be $550 million in single-family, adjustable-rate mortgages originated by 10 thrifts.

And the final deal involves $420 million of adjustable- and fixed-rate mortgages for multi-family dwellings that were originated by four California thrifts.

These four sales will follow 12 other mortgage securitizations totaling $5.1 billion.

The RTC has filed two shelf registrations with the Securities and Exchange Commission that allow it to sell up $14 billion in mortgage pass-through securities. When these deals are concluded, the RTC will have sold half of the securities it has told the SEC it plans to sell.

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