The Federal Reserve could lower mortgage rates more effectively by reinvesting its balance sheet runoff in agency MBS, according to a new proposal from Pacific Investment Management Company.

Daily trades in agency MBS aren’t at bragging levels, but there is one positive: Spreads are narrowing.

The $510 million deal received a AAA rating from Moody’s Ratings.

Fitch, S&P and Moody’s continued to dominate the ABS market’s key sectors: vehicle and business finance. The residential MBS business is spread out more among the five major ratings services. (Includes two data tables.)

Tricolor Holdings filed for bankruptcy after fraud allegations emerged following a portfolio review by one of its creditors.

The biggest growth was in agency pass-throughs, while bank trading accounts saw a small decline in agency CMOs. (Includes two data tables.)

Smaller contract sizes on home equity investments have made forward-flow agreements an attractive option for investors.

Performance in the category varies by borrower type.

FCI Lender Services is seeing success subservicing securitizations of residential transition loans and other non-agency MBS.

The structure helps issuers extend prefunding and investment periods beyond the 90-day limitation that applies to traditional real estate mortgage investment conduits.