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Federal Reserve Bank of New York and BlackRock (BLK: 196.10 -0.95%) sold $1.3 billion of subprime mortgage bonds the Federal Reserve acquired from AIG upon bailing out the insurer three years ago.
The sale of the bonds came after the Fedearl Reserve rejected a bid from AIG to repurchase all of the assets in the Maiden Lane II portfolio for $15.7 billion.
Richard Fisher, president of the Federal Reserve Bank of Dallas, said the central bank's "duty is to get the best returns on any investment and to do that in a responsible way."
According to the Fed's website, it announced an offering of $1.5 billion in former AIG securities assets this week.
The Fed chose to have BlackRock sell the assets off in smaller pieces under the notion it would produce a higher profit for taxpayers.