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The Federal Deposit Insurance Corp. (FDIC) has begun selling mortgage-backed bonds from Silicon Valley Bank and Signature Bank (OTC:SBNY).

The Wall Street Journal reported the FDIC put up $700 million of high-quality mortgage-backed bonds yesterday as part of an effort to recover the $114 billion in face value of the bonds it assumed. The FDIC estimated its deposit-insurance fund is going to lose roughly $22.5 billion from depositor payouts at the two banks – and while most of that sum will be reimbursed through an assessment on other banks, the agency is still looking at a $3.3 billion net loss.

Adam Murphy, founder of Empirasign, a bond-data service, told the Journal that the federal government “should expect to get back around 86 cents on the dollar for the entire portfolio.”

The FDIC auction consisted of $292 million of agency bonds backed by mortgages guaranteed by the government-sponsored enterprises and $392 million of nonagency debt. All of the bonds auctioned were AAA rated. Another auction is planned for next week, with the FDIC seeking to sell about $660 million of lower-rated bonds, including some at a CCC level.