Lloyds Banking Group is mulling to auction about $8.7 billion of US mortgage securities that were issued prior the credit crisis, reports Bloomberg.
A person with knowledge of the offering told Bloomberg that the home-loan bonds are being sold next week by British lender, because the transaction isn’t public. Lloyds acquired a portfolio of mortgage debt in 2009 as part of its acquisition of HBOS Plc.
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Investor appetite for mortgage securities in the US is on rise off late. According to Barclays index data US subprime-mortgage securities composed of loans made to the weakest borrowers have returned 12.7% this year on average, after rallying more than 41%.
According to Empirasign Strategies, a New York-based provider of data on securitization-market trading, the auction is the biggest widely marketed sale of securitized debt since at least March 2010.
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