TALF loans against newly issued ABS and CMBS have been extended through March 31, 2010. Lending against newly issued CMBS has been extended through June 30, 2010. The Fed explained the discrepancy by noting that CMBS loans take longer to arrange.
The Fed also said it will not consider expanding eligible collateral for TALF. Currently the securities eligible for collateralizing TALF loans include newly issued, triple-A-rated ABS backed by loans to consumers and businesses, and newly issued and legacy triple-A-rated CMBS. It's possible that these decisions could be revisited, the Fed said in a statement, depending on how the economy performs.
However there have been several signs that macroeconomic conditions are improving; indeed the Fed noted as much in its recent two-day meeting to set interest rates. The federal funds rate remained at zero to little surprise--but the Fed did say it will slow the place of its program to buy $300 billion in US Treasuries.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
