WASHINGTON — Several small local housing finance agencies will not be participating in the new-issue bond purchase program recently rolled out by the Treasury Department. Instead, they have opted to return their allocations because high fees and the Treasury’s refusal to allow escrowed bonds to be sold at a premium make it economically infeasible for them to do the transactions.

Exact numbers are not yet known, but at least a dozen local HFAs out of the 100 that received allocations from the Treasury have dropped out of the program. John Murphy, the executive director of the National Association of Local Housing Finance Agencies, said yesterday he expects the exact number to eventually be higher.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.