Fannie Mae and Freddie Mac combined did more business in single-family mortgage-backed securities issuance in 2012 than in any year since 2003, with a growing share of their business coming from small and mid-sized lenders, according to an Inside The GSEs analysis. The two GSEs pumped out a staggering $1.266 trillion in new single-family MBS in 2012, a 48.1 percent increase over their total production in 2011. It marked the biggest annual output by Fannie and Freddie since the all-time record of $1.912 trillion nine years earlier.
Redwood Trust is set to issue its first non-agency jumbo mortgage-backed security of the year, a portion of which will include ARMs and significant contributions from EverBank. The real estate investment trust said it is close to being able to issue one non-agency MBS a month this year, up from six in all of 2012. Sequoia Mortgage Trust 2013-1 largely includes characteristics common to other recent Redwood deals, including 7.30 percent credit enhancement for the two tranches set to receive AAA ratings from Fitch Ratings, Kroll Bond Rating Agency and Moodys Investors Service. However, ARMs have not been included in a Redwood deal since a January 2012 issuance. ARMs will account...
A new non-agency jumbo MBS from a subsidiary of Credit Suisse Group includes some key differences compared with Redwood Trust deals, while pumping life into the non-agency market. DLJ Mortgage Capital issued a $329.89 million non-agency jumbo MBS late last week via a private placement; it was the companys third of 2012. CSMC Trust 2012-CIM3 received a AAA rating from Standard & Poors with credit enhancement of 5.85 percent on the top-rated tranche. The new Credit Suisse deal included...
UBS Americas took its challenge to the first of a long line of mortgage-backed securities lawsuits brought by the Federal Housing Finance Agency to a federal appeals court this week, arguing the GSE conservator waited too long before filing charges that the company misled Fannie Mae and Freddie Mac in selling toxic non-agency MBS to the two GSEs.
The top three rating services continued to dominate the new issuance market in non-mortgage ABS during the first nine months of 2012, according to a new Inside MBS & ABS analysis, but the biggest player in the non-agency MBS market was DBRS. Moodys Investors Service rated 69.7 percent of the non-mortgage ABS issued in 2012 as of the end of the third quarter, down slightly from its 70.4 percent share of the 2011 market. The companys strengths were in vehicle finance and business loan ABS, where it captured more than three-quarters of new issuance by dollar volume. Standard & Poors ranked...[Includes two data charts]
The Securities and Exchange Commission last week approved a proposal from the Financial Industry Regulatory Authority to increase transparency regarding MBS and ABS trading. Hearing no public comments after it announced the proposal in September, the SEC agreed to FINRAs plan to establish public reporting of trading in specified government-backed mortgage bonds and securities backed by Small Business Administration loans. According to the SEC notice published Oct. 23, the plan would leverage...
Just two institutions Fannie Mae and Freddie Mac end up securitizing the vast majority of conventional home loans, but a large universe of lenders deliver a significantly diverse supply of loans to the government-sponsored enterprises. A new Inside Mortgage Finance special report based on loan-level securities disclosures reveals that 1,848 different institutions delivered single-family mortgages to the two GSEs during the third quarter. They ranged in size from Wells Fargo, which delivered nearly a quarter of mortgages securitized by Fannie and Freddie during the period, to Wisconsin-based Universal Mortgage Corp., which sold one small $39,000 loan to Fannie during the period. The report, GSE Seller Profile: 3Q12, shows...
The recent enactment of the Honoring Americas Veterans and Caring for Camp Lejeune Families Act of 2012 includes a number of changes to the Department of Veterans Affairs Loan Guaranty program, including reverting to the VAs previous method of calculating maximum guaranty. The restoration of the previous method used to derive VA loan limits has resulted in the increase of some loan limits, according to guidance issued by the agency last week. While VA does not have a maximum loan amount, county limits must be used to calculate the maximum VA guaranty for a particular county. The maximum VA loan limit for 2012 in high-cost areas is ...
As the shadow banking sector has grown and evolved since the 1970s, questions have arisen as to the extent to which traditional banks may have been displaced by other financial institutions, insurance companies and entities as alternate sources of financing and the credit enhancement to securitization transactions. However, three economists at the New York Federal Reserve Bank recently found that, contrary to the notion that banks are being eclipsed by other institutions, banks have held their own against insurance companies involved in the enhancement business, despite their underdog status. The first thing to note is that enhancements by insurance companies outnumber...
Bank of America appears to be moving slower than some industry analysts had expected in fulfilling some of its obligations under the proposed $8.5 billion settlement over Countrywide MBS reached last year with Bank of New York Mellon as trustee for a group of institutional investors. Although the settlement is far from finalized, BofA said it would move distressed loans to subservicers regardless of the outcome. The bank has moved approximately 38,000 mortgages to Specialized Loan Servicing, Select Portfolio Servicing and Green Tree, as of June 26, 2012, according to analysts at Barclays. Of this amount, 73 percent were shipped to SLS, SPS got 21 percent, and Green Tree received 6 percent. Of the 38,000 loans, mortgage servicing rights have been transferred...