Weaker issuers could face problems when TALF ends

When the Federal Reserve winds down the Term Asset-Backed Securities Loan Facility in March, some types of securities backed by consumer loans will face bigger issues than others, industry participants said. Higher-quality bonds and stronger issuers will be fine, while weaker issuers and those with deals backed by underperforming consumer loans will struggle. "The impact of the end of TALF may be different for the generic on-the-run asset classes versus less-liquid, less-frequently securitized asset classes," said Michael Wade of Barclays Capital.

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