FDIC reveals final covered bond policy, makes few changes
The Federal Deposit Insurance Corp revealed its final covered policy statement yesterday (Tuesday) afternoon in Washington. The 4% limit on covered bond issuance to total liabilities remains in place from the interim version, commercial mortgages do not join residential mortgages as eligible collateral and no grandfathering of previously issued bonds will take place. However, chairman Sheila Bair said: “The 4% limit is, I think, not going to be there forever.” Read EuroWeek on Friday for the market’s reaction to the statement.
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