The Federal Reserve decided against instituting new mortgage risk weightings in issuing its Basel III final rule this week, a decision that will likely make it easier and cheaper for financial institutions to hold onto their legacy non-agency MBS and thereby reduce the pressure they may feel to deleverage their balance sheets. “In light of new regulations designed to improve the quality of mortgage underwriting as well as continued uncertainty regarding the aggregate impact of pending mortgage-related rulemakings, the draft final rule does not include the proposed risk weights and instead incorporates the risk weights for residential mortgages under the general risk-based capital rules, which assign a risk weight of either 50 percent (for most first-lien exposures) or 100 percent for other residential mortgage exposures,” the Fed said. That means...

A number of mortgage companies are preparing to go public. Meanwhile, non-agency MBS issuers are churning out deals again after a slight delay.

Fannie Mae and Freddie Mac saw a marked decline in refinance business during the second quarter of 2013, but a strengthening housing market helped offset some of the lost volume. The two government-sponsored enterprises securitized $256.0 billion of single-family refinance loans during the second quarter, according to the Inside Mortgage Finance GSE Seller Profile, a quarterly statistical report based on loan-level, mortgage-backed securities disclosures. That was down 13.6 percent from ... [Includes two data charts]

A sharp downturn in refinance activity reduced Fannie Mae’s and Freddie Mac’s business volume during the second quarter of 2013, but the GSEs posted their strongest quarter in purchase-mortgage activity in four years, according to a new Inside The GSEs analysis. Fannie and Freddie issued $337.74 billion in single-family mortgage-backed securities during the second quarter, a 5.1 percent decline from the first three months of the year. The decline put an end to an upward trend in GSE production that took hold during the third quarter of 2012. Despite this, Fannie and Freddie business was up 20.0 percent over the first six months of last year.

Roughly $495 billion of residential MBS and non-mortgage ABS were issued during the second quarter of 2013, according to a new Inside MBS & ABS market analysis.

Credit Suisse issued a non-agency jumbo MBS backed predominantly by seasoned mortgages from First Republic Bank.

The Federal Reserve will go ahead with proposed rule changes related to mortgage servicing rights, but with what it calls a “lengthy transition period.”

The volume of new business flowing through Fannie Mae and Freddie Mac – a lagging indicator of primary market originations – declined modestly during the second quarter of 2013, according to a new analysis and ranking by Inside Mortgage Finance. The two government-sponsored enterprises securitized $337.74 billion of single-family mortgages during the second quarter, down 5.1 percent from the first three months of the year. The decline reversed an upward trend in quarterly GSE production that started in the third quarter of 2012. Even with the downturn, business at Fannie and Freddie was up 20.0 percent over the first six months of last year. The second-quarter decline clearly reflected...[Includes three data charts]

Jumbo conduits such as Credit Suisse and Redwood Trust are working to increase the number of correspondent lenders they work with as the non-agency jumbo mortgage-backed security market starts to rebound. The conduits offer attractive execution for lenders that don’t want to hold jumbo originations in portfolio, according to industry participants. Jumbo conduits are “a real business that’s going to be in this for the long term,” said Peter Sack, a managing director at Credit Suisse, during a webinar hosted by Inside Mortgage Finance late last week. Some $3.9 billion in non-agency jumbo mortgage-backed securities were issued...

Hedge fund giant Cerberus Capital Management has quietly purchased a nonbank mortgage company based in Georgia and plans to use the firm to grow it into a national player in residential finance, according to industry sources close to the deal. One official inside of Cerberus confirmed the purchase to Inside Mortgage Finance as well as some of the growth plans, but declined to identify the company. Cerberus, which makes investments worldwide, operates dozens of funds, many of which target specific sectors or projects. The sale was facilitated...