Covered Bonds: FDIC Action Might Spur US Covered Bond Growth

Covered bonds have recently begun to receive significant attention in the United States as a result of the first U.S. structured covered bond issuance, the FDIC's approval on April 15, 2008, of the issuance of an interim final covered bond policy statement, and the credit crisis. Although covered bonds are one of the oldest asset financing techniques, they are still relatively unknown in the United States. Given the size of the worldwide covered bond market and the appeal of covered bonds to both issuers and investors on a worldwide basis, we believe that covered bonds will become a significantly larger part of U.S. mortgage finance.

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