The U.S. Treasury today gave an update on its continued orderly wind down of its agency guaranteed MBS portfolio.

The Treasury's report showed that the remaining amount of principal outstanding in its  MBS portfolio is $94.5 billion. The government agency made an original investment of over $225 billion in agency-guaranteed MBS. 

Over June, the agency got an added $12.7 billion in proceeds from this investment via Treasury sales with a market value of $10.6 billion ($10.0 billion principal value) and principal and interest payments of $2.1 billion, according to the Treasury's report. 

Through the end of June, there has been a cumulative total of $146.9 billion in proceeds from this investment through sales by Treasury worth $35.0 billion and principal and interest payments of $111.9 billion.

The Treasury has now recovered 65% or $146.9 billion of its initial $225 billion MBS investment, which it made in 2008 and 2009.

According to the Treasury, these MBS purchases helped stabilize the financial markets as well as preserve access to mortgage credit during the financial turmoil.

The MBS market has improved considerably since Treasury bought these securities, the government agency said. Based on current market conditions, it expects to make a profit on this investment.

On March 21, the Treasury announced that it would start the orderly wind down of its MBS portfolio.

The Treasury intends to sell up to $10 billion MBS principal per month depending on market conditions. The sale is part of Treasury’s efforts to wind down emergency financial crisis response programs that were put in place in 2008 and 2009.

The original Treasury announcement can be found via this link.

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