Government-sponsored enterprise (GSE) Fannie Mae is reportedly readying to auction about $1 billion of mortgage bonds without U.S. backing from its holdings.
The private auction of non-agency securities has been scheduled for July 11, according to a Bloomberg News report, citing sources close to the deal who wished to remain anonymous.
As of Dec. 31, Fannie Mae owned about $36 billion in mortgage debt, according to the report. That is about half as much as its sibling, Freddie Mac, which conducted a similar auction in May.
Both companies have returned to profitability since the government took them over in 2008. As such, their debt is now declining.
In March, the Federal Housing Finance Agency gave Fannie Mae and Freddie Mac executives a goal of selling off at least 5% of their illiquid holdings this year.
For more, check out the Bloomberg News report.