The U.S. Department of the Treasury announced plans to begin the "orderly" wind down of its $142 billion portfolio of agency-guaranteed mortgage-backed securities (MBS).  Under the plan, the Treasury will sell up to $10 billion MBS per month, subject to market conditions.

 

“We’re continuing to wind down the emergency programs that were put in place in 2008 and 2009 to help restore market stability, and the sale of these securities is consistent with that effort,” said Mary J. Miller, Assistant Secretary for Financial Markets. “We will exit this investment at a gradual and orderly pace to maximize the recovery of taxpayer dollars and help protect the process of repair of the housing finance market.”

The MBS portfolio was acquired under authority given to the Treasury by the Housing and Economic Recovery Act of 2008 (HERA).  The stated goal was to help preserve access to mortgage credit and provide stability during the economic crisis.

Believing that the market has stabilized sufficiently since the purchase of the MBS, the Treasury believes they can sell down the portfolio, making a profit for taxpayers on the investment, without unnecessary disruption to the secondary market for MBS.

The department plans to post on their website the results of their sales each month, broken down by coupon and agency.