pmuolo@imfpubs.com Fannie Mae posted a net profit of $1.3 billion in the fourth quarter, a 66 percent decline sequentially, blaming the earnings downdraft on a reduction in the fair value of its derivatives. The GSE “derivative problem” also plagued the fourth quarter results of Freddie Mac, which reported a slim profit of $227 million after writing down its derivatives by $3.4 billion. …
Securitization was still the dominant method to fund new home mortgage production in 2014, but Wall Street got a run for its money from portfolio lenders. A new Inside MBS & ABS analysis reveals that 70.5 percent of residential mortgages originated last year were funneled into mortgage securities. That was down from 78.5 percent in 2013 and represented the lowest mortgage securitization rate since 2006. Delivering eligible loans into new Fannie Mae, Freddie Mac and Ginnie Mae securities is...[Includes one data chart]
Industry participants in the Treasury Market Practices Group raised questions about the tax consequences and other issues involved in the plan to develop a “single security” in a meeting with the Federal Housing Finance Agency last month. The recently released minutes of the meeting do not provide much detail. The FHFA representatives described in broad terms the project to create a fungible MBS that Fannie Mae and Freddie Mac would both issue in the to-be-announced market. In response, “Most TMPG members noted...
Cherry Hill Mortgage Investment Corp., which has 76 percent of its assets invested in MBS, plans to whittle that down a bit and make a major push into mortgage servicing rights. The question is: will other real estate investment trusts follow suit? One REIT executive, who spoke under the condition his name not be used, said...
In 2018, the GSE capital buffer falls to zero dollars. Zilch. Nada. Hopefully by then, President Bush or President Clinton will have worked out a GSE reform deal with Congress…
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