As the New York Federal Reserve moves closer to completing the winding down of its Maiden Lane (ML) vehicles, investors face a falloff in inventory volumes. This poses a further challenge in this yield-starved environment.

The New York Fed set up the ML I vehicle in early 2008 to facilitate the sale of Bear Stearns to JPMorgan Chase. The ML II and III vehicles were formed in November 2008 to prevent AIG from collapsing. ML II purchased $20.5 billion in fair value of RMBS from AIG's securities lending portfolio while ML III funded the purchase $29.3 billion in fair value of CDOs on which AIG had written protection.

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