Short of a market miracle, the chances of other Ginnie Mae mortgage-backed securities servicers catching up with market leaders Wells Fargo and Bank of America are practically nil. Wells Fargo and BofA appear to have a solid lock on 55.0 percent of Ginnie Mae servicing outstanding based on a combined portfolio total of $634.0 billion at the end of June. Overall, the supply of Ginnie Mae servicing grew 3.8 percent during the second quarter. Wells Fargo commanded a 28.2 percent share of Ginnie Mae servicing during the second quarter, up 4.7 percent from the first quarter. Not far behind is second-ranked BofA with a 26.6 percent share, thanks to... [Includes one data chart]

Officials testifying before a Senate Banking, Housing and Urban Affairs Committee hearing this week came out in strong opposition to eliminating a government guarantee in the MBS market of the future, claiming that such measures would have a significant impact on borrowers’ ability to obtain plain vanilla 30-year fixed-rate mortgages. “Many large investors utilize the MBS market to execute trades driven by macroeconomic views and would not utilize a market which combines credit risk with interest rate risk,” said Andrew Davidson, president of Andrew Davidson & Co., an analytics and consulting firm. “With a smaller investor base, liquidity would be...

Nationally recognized statistical rating organization Kroll Bond Rating Agency demonstrated its optimism in the non-agency market by requesting public comment this week on its rating methodology for evaluating residential MBS. “By providing complete transparency into our approach and processes, we aim to instill trust in the market and to raise the bar on ratings accuracy,” said James Nadler, Kroll’s president, in a statement. “These [publications on our proposed rating process] demonstrate our strong commitment to serving the market through a rigorous evaluation of the collateral as well as key parties in an RMBS, and combine all aspects of...

Two Harbors Investment Corp. said this week it is “impressed with the investment opportunities” in the non-agency MBS sector, particularly over the next year and beyond and is pushing forward with its plans to begin a securitization program. Thomas Siering, president and CEO of the New York-based real estate investment trust, said during a conference call to discuss the firm’s second quarter earnings that despite the “challenging” non-agency environment in June, there is tremendous opportunity to profit from non-agency MBS issuance throughout the rest of this year into 2012. “The recent pullback in the non-agency market has created...

The Mortgage Bankers Association urged the Federal Housing Finance Agency to include other fee structures and not just seek public comment on one servicing fee structure in a forthcoming proposal. The FHFA has been working behind closed doors with Fannie Mae, Freddie Mac and Ginnie Mae to devise a new servicing compensation structure for mortgages securitized by the agencies, which account for over 90 percent of new lending. Industry groups and others have been consulted during the process, which is expected to result in an exposure document subject to public comment. The MBA cautioned the FHFA against showing preference for any...

Fannie Mae and Freddie Mac will not be branching out into the role of a “master servicer” in a new, yet-to-be-launched $2 billion bond program as top Republican members of the House Financial Services Committee feared, according to Treasury Secretary Timothy Geithner.In a letter dated July 21 and in response to a letter sent by Committee Chairman Spencer Bachus, R-AL, Vice Chairman Jeb Hensarling, R-TX, and four of the committee’s subcommittee chairman, Geithner firmly ruled out any participation by the two GSEs in Treasury’s loan-guarantee program.

The Federal Housing Finance Agency said last week to expect further litigation in its ongoing efforts to recover losses suffered by Fannie Mae and Freddie Mac in connection to the two GSEs’ investments in non-agency securities.Last week, the Finance Agency filed suit against UBS Americas Inc. and various related entities alleging misstatements and omissions of non-agency MBS purchased by Fannie and Freddie.

Wells Fargo and Bank of America continued to pull ahead of the field, adding Ginnie Mae servicing to their portfolios faster than the overall market grew during the second quarter of 2011. A new Inside Mortgage Finance analysis found the two companies holding 54.9 percent of Ginnie servicing outstanding at the end of June. Third-place JPMorgan Chase trailed overall growth in the market, while CitiMortgage and PNC Bank actually [includes one data chart]

MBS and ABS investors would have an easier time organizing to press deal sponsors to address potential problems under a revised proposed rule on shelf registration that was approved by the Securities and Exchange Commission this week. The agency made several major changes to its proposed overhaul of shelf eligibility requirements that was aired back in 2010 and put the revised package out for public comment. Most of the changes reflect public comment on the original proposal as well as the passage of the Dodd-Frank Act. Under the latest proposal, MBS and ABS issuers would be required to ...

The Federal Housing Finance Agency this week filed suit against UBS Securities and various related entities as well as former top officials of the firm over alleged misrepresentations on subprime and Alt A MBS sold to Fannie Mae and Freddie Mac. The two government-sponsored enterprises bought some $4.5 billion of non-agency MBS issued on two UBS shelf registrations between September 2005 and August 2007. The deals included single-seller and conduit transactions with mortgages originated by ...