The Federal Reserve Bank of New York announced yesterday the expansion of the Term Asset-Backed Securities Loan Facility to include legacy CMBS issued before January 1, 2009.
The announcement includes the specification of applicable interest spreads and haircuts. TALF eligibility for CMBS is subject to a number of requirements, including requirements with respect to credit ratings (from specified CMBS-eligible rating agencies), seniority and underlying mortgage collateral. Some other requirements have not as yet been specified. The first legacy CMBS subscription and settlement will occur in late July. The memorandum below highlights the key details of the expansion.