NY Fed Recoups $70 Billion Bear Stearns, AIG Loans
The New York Fed said it has fully recouped more than $70 billion in loans it made to support the 2008 bailouts of Bear Stearns and American International Group, closing a contentious chapter in the central bank’s history.
The regional bank said it has been repaid, with interest, on $53.1 billion in loans it made to two crisis-era vehicles that held complex subprime mortgage bonds, home loans, commercial-property loans and other unwanted assets from Bear and AIG.
The New York Fed earlier recouped a separate $19.5 billion loan that financed the purchase of mortgage-backed securities from AIG.
William C. Dudley, president of the New York Fed, said, “This is a major milestone for the bank and for the public. The successful repayment of the New York Fed’s loans to ML LLC and ML III LLC marks the retirement of the last remaining debts owed to the bank that stemmed from the crisis-era interventions with Bear Stearns and AIG. The Maiden Lane entities were established to protect the U.S. economy at a time of great economic stress, and I am pleased we were able to accomplish that policy objective and be fully repaid.”