Decisions by federal regulators have combined to promote issuance of agency MBS over non-agency MBS, a trend that is expected to continue for years to come, according to industry analysts. Panelists at a talk this week sponsored by the American Enterprise Institute cited rules from the Consumer Financial Protection Bureau along with pending rules to set requirements for risk retention on MBS issuance and capital requirements for originations and securitization. “Until you know what the rules of the game are going to be...
Primary market originators and due diligence providers say the elusive market in private placement MBS deals has been gaining strength this year. “We’re seeing three to five private deals a month,” said Jeff Taylor, managing partner of Digital Risk, a New York-based risk management and due diligence firm. As for the underlying product, it’s across the board, he added. “It can be jumbo, nonperforming, and re-performing.” But the deals are also much smaller than the rapidly growing public MBS deals. Digital Risk, which conducts due diligence reviews on the underlying collateral, said...
The new central counterparty for MBS trades is having a difficult time delivering results and is, in fact, experiencing a drawback because of stringent margin rules as well as other internal issues, according to financial advisory firm NewOak Capital Advisors. The regulated multilateral central counterparty trading platform for executing to-be-announced agency MBS is not at full power because most TBA participants are not doing what they are supposed to, observed Ron D’Vari, chief executive officer and co-founder of NewOak. “The key drawbacks are...
In recent months, the Securities and Exchange Commission has looked into Regulation AB compliance issues regarding non-agency MBS issuance from 2010 and 2011 by Redwood Trust. The SEC questioned Redwood and others involved in the issuance regarding disclosures of servicing practices. An official at Redwood said the issue largely relates to the complicated nature of Redwood’s deals. In particular, issuance from Redwood often involves multiple servicers, each of which can be subject to Reg AB disclosure requirements. According to correspondence published this week by Redwood, the SEC first queried...
A total of $47.13 billion of new non-mortgage ABS were issued during the first quarter of 2013, a solid 31.2 percent gain from the end of last year, according to a new Inside MBS & ABS analysis and ranking of issuers and underwriters. The fast start for 2013 ABS issuance was up 15.1 percent from the first three months of last year, although it came up short of three of the strongest quarters since the financial market meltdown in late 2008, including the second quarter of 2012. If new issuance can maintain its current pace for the rest of the year, 2013 could see the strongest ABS production volume since before the crash. The driver so far has been...[Includes two data charts]
There’s a growing interest on the part of new investors in buying residential mortgage servicing rights, but observers say a major impediment for the market is a lack of confidence that Fannie Mae and Freddie Mac will acknowledge their ownership rights. “It’s a problem,” said Tom Piercy, managing member of Interactive Mortgage Advisors, a servicing brokerage and advisory firm. “Fannie and Freddie could learn a thing or two from Ginnie.” The phrase “new investors” generally applies...
The bulk servicing market is beginning to generate heat. The latest offering comes from Interactive Mortgage Advisors, but other deals are in the works as well.
Fannie Mae and Freddie Mac are now earning money hand-over-fist - cash that will wind up in the coffers of Uncle Sam. But is the White House underestimating how much the two GSEs will earn?
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