JPMorgan Selected as Custodian for Fed's MBS Repurchase Program

The U.S. Federal Reserve has hired JPMorgan Chase as its custodian to run the central bank's purchase of up to $500 billion in mortgage-backed securities as part of the Fed's quantitative easing strategy to liquidate the U.S. financial system.

The Fed also selected Blackrock Financial Management, Goldman Sachs Asset Management, Pacific Investment Management and Wellington Management Company to manage the Fed's assets.

The firms will manage assets backed by Fannie Mae, Freddie Mac and Ginnie Mae via a facility set up in November 2008 to provide relief to the banking system.

By Erik Kevin Franco and edited by Stephen Huebl
©CEP News Ltd. 2009