Fed Plans AIG Bond Auction

The Federal Reserve is mulling an auction for a large portfolio of subprime-mortgage bonds, known as Maiden Lane II.

The Federal Reserve is mulling an auction for a large portfolio of subprime-mortgage bonds, known as Maiden Lane II, The Wall Street Journal reports. The move comes after AIG formally offered $15.7 billion to acquire the bonds from the Fed. The Fed took over the portfolio in 2008 to help the government-controlled insurer. It appointed BlackRock in 2008 to manage the bond portfolio, and is consulting with the firm about the process. The portfolio has a face value of roughly $30 billion.

Click here for the story from The Wall Street Journal.