Two industry veterans say securitizing toxic corporate assets could push the cost of corporate stabilization above the current $9.5 billion tab.
"In order to attract investors, NCUA will either have to provide a guarantee to make up the difference for underperforming assets, or sell them at a deep discount, or a combination of the two," said Charlie Felker, managing director of regulatory affairs for First Empire Securities.
FDIC issued $1.8 billion in notes March 5 that were collateralized by $3.7 billion in toxic assets from seven seized banks. NCUA Chairman Debbie Matz has valued corporate legacy assets at $50 billion.
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