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Americas

US to sell billions-worth of toxic assets

media US Federal Reserve Chairman Ben Bernanke (L) and Treasury Secretary Timothy … Reuters/Jonathan Ernst

The US Treasury Department said on Monday that it would start selling off tens of billions of dollars worth of toxic asset in an effort to continue repairing the country’s housing finance market. The Treasury said it would sell an estimated 142 billion dollars (100 billion euros) of mortgage-backed securities that it bought from banks as part of the bailout of the financial sector in 2008-2009.

The department is now ready to “exit this investment”, according to Treasury official Mary Miller.

The value of these securities, which bundle together large numbers of often distressed mortgages, plummeted when the US housing bubble popped.

The Treasury hopes to make 15-20 billion dollars (10-14 billion euros) in profit from the sales, as the market for the securities is now much more robust.

US insurer American International Group (AIG) recently offered to buy back 15.7 billion dollars (11 billion euros) in in mortgage-backed securities from the Federal Reserve.

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