A resumption in quantitative easing — at a pace that dwarfs asset purchases during the financial crisis — is just one of several Fed actions to keep credit markets functioning through the coronavirus crisis.
Federal forbearance on government backed mortgages is a panacea to deal with the economic fall-out caused by the novel coronavirus. But eventually there will be implications in the primary and secondary markets.
The current standard language in leveraged loan documents may expose issuers to heightened credit risk and a spike in debt service costs when LIBOR is no longer viable, according to Fitch Ratings.
GSE recap-and-release work will generate millions of dollars in fees for the lucky advisory firms. In a few weeks, the FHFA is expected to announce its counsel.
The key factor for TBA investors is prepayment speeds. A quick scan of the FHFA data show that the conditional prepayment rates for UMBS issued by Fannie and those issued by Freddie have remained comparable since the launch of the single security in June.
FSOC continues to focus on the risk posed by nonbanks, which are key players in the MBS market. But is the regulator worrying too much? Opinions differ.
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