CMBS Deal Could Open TALF to Secondary Commercial Market

The Federal Reserve may be close to doing its first deal using an emergency credit facility to aid the sale of commercial mortgage-backed securities (CMBS).

The Fed decided in June to extend its Term Asset-Backed Securities Loan Facility (TALF),designed to help jump start securitization markets, to CMBS, but has been cautious about actually deploying the central bank credit for these securities purchases amid concerns about the commercial real estate sector. The agency, though, is reportedly close to completing due diligence on an issue prepared by Goldman Sachs for a $400 million loan.