FDIC Starts Selling $114 Billion of Bonds From Failed Banks

Agency forecasts a $3.3 billion net loss for deposit-insurance fund

Bonds that were held by Silicon Valley Bank will help pay for the cost of rescuing depositors. Photo: Steven Senne/Associated Press

The Federal Deposit Insurance Corp. has begun selling bonds it inherited from Silicon Valley Bank and Signature Bank to recoup the cost of rescuing the failed banks’ depositors.

The FDIC put up for auction about $700 million of high-quality mortgage-backed bonds Tuesday in what could prove to be a test of how much the U.S. government recovers on the $114 billion in face value of the bonds it assumed.

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