Effective June 2012, Ginnie Mae will provide monthly disclosures about accumulated multiple issuer pool (MIP) activity in terms of dollar amount and number of loans as well as by pool term, pool type and security interest. The information provided will apply to issuances for the current month. The disclosure will provide issuers and investors additional insight into the multiple issuer pools in process. However, the information can change any time until the completion of the MIP process at the end of the month, Ginnie Mae cautioned. A final list will be ...

With banks under increased pressure to manage their exposure to risks related to mortgage-backed securities and whole loans, Moody’s Analytics has updated its risk and capital allocation tool so clients can run their mortgage portfolio under various stressed scenarios and get a better handle on potential losses. The latest iteration of the Mortgage Portfolio Analyzer features an enhanced framework for modeling stressed macroeconomic scenarios, defaults, prepayments and severities. The tool that the firm has put together can “simultaneously benefit institutions that have portfolios of not...

Banks and thrifts added some $67.2 billion in residential MBS to their investment portfolios during the first quarter of 2012, according to a new Inside MBS & ABS ranking and analysis. The increase amounted to a 4.3 percent gain from bank and thrift MBS holdings at the end of 2011, and raised the industry’s total investment to a record $1.634 trillion. It marked the first time since 2004 that banks and thrifts owned more than a quarter of the MBS market. The biggest increase was in holdings of agency pass-through securities, which rose 6.2 percent from the fourth quarter to $974.4...(Includes two data charts)

Ally Financial negotiated an $8.7 billion settlement with investors in non-agency MBS issued by Residential Capital before putting the company, one of the pioneers in the securitization of jumbo, Alt A and subprime mortgages, into bankruptcy. Long before ResCap’s bankruptcy filing early this week, trustees for outstanding non-agency MBS had already been instructed by 17 investors to sue Ally Financial for compensation over alleged violations of ResCap representations and warranties. The deal was reached shortly before the filings, according to a source close to the matter. Ally said that some 290 MBS trusts...

A proposal from the Financial Industry Regulatory Authority to begin disseminating data for agency MBS traded as specified pools could compromise the confidentiality of market participants and discourage them from future participation, according to the Securities Industry and Financial Markets Association. The FINRA wants to implement shorter reporting timeframes for MBS-SP transactions (initially two hours, then one hour), as well as real-time dissemination of trade information. Volume information would be capped at $10 million. Trades above that amount would be displayed as “10+.” “Our dealer and...

The government overseer of Fannie Mae and Freddie Mac wants to help trim the footprint of the two government-sponsored enterprises by selling credit risk to private investors, but a top public policy analyst questions how effective such efforts will be in bringing private capital back to residential mortgage markets. “The basic business model of credit-risk insurance doesn’t just make sense,” said Karen Shaw Petrou, managing partner at Federal Financial Analytics, a think-tank in Washington, DC. “Because of the damage done in the run-up to the crisis, traditional insurers are at great risk of being...

This week, Fitch Ratings downgraded Washington Mutual’s covered bonds to ‘AA-’ from ‘AA’ and placed them on rating watch negative, after last week’s downgrade of the issuer default rating of the program sponsor, JPMorgan Chase Bank. That rating action followed JPMorgan Chase’s disclosure last week of a $2 billion trading loss on its synthetic credit positions in its chief investment office. The positions were intended to hedge JPM's overall credit exposure, particularly during periods of credit stress. That loss estimate has since grown to $3 billion, it was reported this week. The JPMorgan...

Converting real estate owned properties to rental units is still in its infancy but it could be a compelling asset type for investors. If securitized, it could provide a much-needed boost to the real estate market, according to Standard & Poor’s. In a recent analysis, S&P suggested taking the government’s REO-to-rent pilot program a step further and consider securitizing the rental streams from a pool of underlying REO assets, which could potentially provide a steady cash flow to back securitization transactions. Proceeds from the eventual sale of the properties could also be incorporated into the cash...

Both Fannie Mae and Freddie Mac held onto their ample shares of mortgage-backed securities with something of a bump during the first quarter of 2012, according to a new Inside The GSEs analysis. The GSEs issued a combined $303.9 billion in MBS during the first quarter, a 13.9 percent increase from the fourth quarter of 2011. Compared to the first quarter of last year, Fannie and Freddie saw a 16.4 percent increase in MBS issuance. Between the two companies, Fannie and Freddie registered a plentiful 77.9 percent share of new MBS during the period that ended March 31, 2012, up from 77.1 percent the two companies held during the fourth quarter of 2011 and much farther apart from the 74.8 percent both GSEs held during the first quarter of 2011.

Look for the Federal Housing Finance Agency to press its multiple legal actions against many of the nation’s biggest issuers of non-agency mortgage-backed securities after a federal judge rejected a bid by UBS Americas to turn back the FHFA’s lawsuit over its sale of non-agency MBS to Fannie Mae and Freddie Mac. Judge Denise Cote, of the U.S. District Court for the Southern District of New York, two weeks ago denied UBS’ motion to dismiss on statute of limitations grounds, while dismissing the FHFA’s negligent misrepresentation claims. The FHFA, as GSE conservator, sued UBS in July 2011 alleging that billions of dollars of MBS purchased by Fannie and Freddie were based on offering documents that contained “materially false statements and omissions.”