The Federal Deposit Insurance Corp. (FDIC) sold $1.37 billion of structured guaranteed notes backed by residential and construction loan assets from Corus Bank. It follows its debut offering from last week.
Sources familiar with the deal said the offering was priced into strong demand.
The sale included $150 million of 1.62-year notes that priced at 18 basis points over Eurodollar swap futures; $850 million of 2.62-year notes that priced at 21 basis points over interest rate swaps; and $377.35 million of 3.62-year notes that priced at a spread of 24 basis points over swaps, market sources said. Barclays Capital was sole underwriter for the offering, which was the same for last week's deal.
The sale follows last week’s sale of FDIC’s $1.8 billion securitization backed by option ARM mortgages that also priced via underwriter Barclays Capital. That deal was divided into a $1.33 billion floating rate transaction and a $480 million fixed-rate deal.
The transaction saw its floating rate portion priced 10 points tighter than the initial price guidance of 65 basis points over one-month Libor and a portion of the fixed rate tranche priced five to 10 points tighter than the initial price guidance of 90 to 95 basis points over i-swaps.
The two deals are part of the total $3.85 billion of securitizations that the FDIC is selling to investors that are guaranteed by the government.
All of the deals are backed by residential mortgage loans and construction loan assets from failed banks that the FDIC took over.