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Volume 2014 - Number 41

October 31, 2014

New Capital, Liquidity Tests are Ginnie Mae’s Insurance Against Potential Issuer Failure, Losses

The new net worth and liquidity requirements and other policy changes announced by Ginnie Mae last week should be viewed in light of the agency’s increased servicer risk stemming from a “new breed” of entities that have entered the market in the wake of the financial crisis, according to analysts. The sharp increase in the share of non-bank servicers has significantly altered Ginnie Mae’s risk exposure to servicer issues, noted analysts at Barclays. “Specifically, the liquidity and capitalization of these non-bank servicers, which are not subject to such requirements for bank servicers, leaves Ginnie Mae exposed to servicing disruptions,” they said. In 2015, Ginnie Mae will adjust...

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This weekly covers the secondary mortgage market, including mortgage-backed securities and asset-backed securities.



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After the November elections, how long will it take for a new Congress and White House to pass GSE reform legislation?

I’m confident a bill will be passed the first year.


2 to 3 years. GSE reform is complicated.


Sadly it won’t happen in a Clinton or Trump first term.


Not in my lifetime.


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