Congress’ decision not to include covered bonds in its financial reform has been met with disappointment. But many are confident of legislation later this year.
"The falling short, by one vote, to provide a statutory framework for US banks to issue covered bonds is a lost opportunity to kick-start the private US market for financing residential mortgage loans," said Jerry Marlatt, senior of counsel at Morrison & Foerster.
Such a move would have been hugely significant. "It would have put US banks more in line with their Canadian and European...