Monday Morning Cup of Coffee: Bubble, bubble, toil and trouble

Monday Morning Cup of Coffee: Bubble, bubble, toil and trouble

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Investments

ING mortgage bonds flood market

Pre-announced liquidation absorbed by Wall Street

bank

According to structured finance analytics firm Interactive Data, the announced liquidation of $5.1 billion from the ING Illiquid Assets Back-up Facility spiked activity levels higher yesterday in the mortgage bond market.

A handful of Wall Street finance companies purchased portions of the 316 residential mortgage backed securities portfolio, according to the Dutch State Treasury Agency.

The ING Group (ING) is a Dutch investment firm and insurer. It received a bailout from the Netherlands and is liquidating all non-core, non-insurance assets as part of the conservatorship.

The ING Illiquid Assets Back-up Facility remaining size of the portfolio has a face value of $6.5 billion, which will be auctioned within the next twelve months.

ING had a notoriously difficult time bringing this portfolio to market and received much greater success in selling off its core U.S. real estate assets.

Here's how the sale went down:

Bank of America (BAC) received a $1.8 billion allocation.

Goldman Sachs (GS) purchased $1.3 billion.

Credit Suisse (CS), Deutsche Bank (DB) and Morgan Stanley (MS) split the remaining amount in relatively equal measure ($550 to $800 million each).

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