In 2Q, the GSEs earned $8.8 billion combined. Multiply that by four (quarters) and then three (years) and you get $105.6 billion.

SIFMA argues that the FHFA has to take a more active role in keeping GSE programs aligned so that differences in prepayment speeds do not emerge.

Charles Schwab Bank was the biggest investor in consumer ABS with $12.49 billion at the midway point in the year.

It could be years before many lenders get comfortable offering non-QMs with significant default risk due to the litigation risk.

Commercial banks and savings institutions reduced their holdings of non-mortgage ABS again during the second quarter, according to a new Inside MBS & ABS analysis of call reports. Banks and thrifts held $147.55 billion of non-mortgage ABS as of the end of June, a 5.1 percent decline from the previous quarter. The banking industry’s aggregate ABS portfolio has been shrinking steadily since the end of 2013 and was down 15.2 percent over that period. Banks shed...[Includes two data tables]

As one jumbo securitization officialtold Inside MBS & ABS: “Gain-on-sale margins have been okay, but no one is buying a new boat.”

Ginnie Mae this week revised its requirements for participating MBS issuers seeking approval of changes in their business status as a result of mergers, change of ownership or control, transfer of assets or a negative turn in their dealings with regulatory agencies. The agency decided to update the guidance because of the increasing number of requests from issuers, according to Ginnie Mae President Ted Tozer. The requests are getting more complex as well, he said. The agency’s Mortgage-Backed Securities Guide has been updated...

The heavyweight Wall Street group that sets the to-be-announced MBS standard is pushing federal regulators to take aggressive steps to keep Fannie Mae and Freddie Mac programs aligned as much as possible as the government-sponsored enterprises develop a new single security. In a sternly written letter to the GSE regulator, the Securities Industry and Financial Markets Association warned that the TBA market could be disrupted if Fannie and Freddie policies diverge too much under the new system in which the GSEs would issue fully-fungible securities. “If performance and credit risk are not aligned, then the securities will not be fungible and the market will not trade them as if they are,” the group said. SIFMA argues...

Jumbo MBS issued since 2010 have better tail-risk protection than deals issued before the financial crisis, according to analysts at Moody’s Investors Service. Provisions addressing tail risk aren’t uniform, however, with some differentiation among issuers. Tail risk occurs when only a few loans remain in an MBS, with activity on the loans subjecting investors to potentially unexpected losses. The risk is particularly pronounced for jumbo MBS as the average loan amount on many deals tops $700,000, and many of the transactions include loans with balances above $1.5 million. In a report released late last week, Moody’s noted...

With MBS issuance volume falling sharply in August, the mortgage industry may have another profit-related concern on its hands: gain-on-sale margins are coming under pressure. For now, no one is panicking, but until the recent rate drop – courtesy of China devaluing its currency – loan volumes were beginning to slow, especially for refinancings, although there’s plenty of hope that the purchase business will stay robust through the remainder of the fall. As one jumbo securitization official told Inside MBS & ABS: “Gain-on-sale margins have been...