President Trump this week announced Michael Bright as his choice to lead Ginnie Mae, an agency under the Department of Housing and Urban Development, even as Senate Democrats continued to delay vote on his nominee for FHA commissioner. Bright is currently Ginnie Mae’s executive vice president and chief operating officer, though he has been serving as acting president since Theodore Tozer stepped down on Jan. 20, 2017. Tozer served as Ginnie president under the Obama administration for nearly seven years. Bright joined Ginnie on July 11, 2017. Previously, he served as director for financial markets at the Milken Institute and as senior vice president of BlackRock/PennyMac. During his time with Milken, Bright co-authored a paper with Ed DeMarco, former acting director of the Federal Housing Finance Agency and currently president of the Financial Services Roundtable, which proposed to ...

After an extended period of steady growth in its investment in the residential MBS market, the banking industry changed course in early 2018 and reduced its participation in the market, according to a new Inside MBS & ABS ranking and analysis. [Includes two data charts.]

The volume of prime non-agency MBS issuance is on the rise as investor demand for the product increases. Pricing in the non-agency MBS market for jumbos is rivaling execution levels for holding the loans in portfolio, and some issuers are seeing better returns by placing loans in non-agency MBS instead of delivering them to the government-sponsored enterprises.

The average daily trading volume in agency MBS inched up to $220.7 billion in April, a stable but weak reading compared to the earliest months of the year, according to figures compiled by the Securities Industry and Financial Markets Association.

Redwood Trust boosted its net income in the first quarter of 2018 and continued to increase its originations of expanded-credit mortgages. The real estate investment trust is seeing strong demand for the loans in the secondary market and Redwood is set to issue its largest expanded-credit mortgage-backed security to date. Redwood had $46.9 million in net income in the quarter, up 51.4 percent from the fourth quarter of 2017 and up 26.7 percent from a year ago. The company sold ...

Most real estate investment trusts that specialize in the agency MBS market allowed their portfolios to decline slightly in the first quarter of 2018, according to a new Inside MBS & ABS analysis. [Includes one data chart.]

Fannie Mae and Freddie Mac continued to whittle away at their retained mortgage portfolios during the first quarter, though the pair still had $469.3 billion of MBS and whole loans on their books at the end of March. [Includes one data chart.]

Spreads on mortgage-backed securities with non-qualified mortgages have tightened in recent years, according to S&P Global Ratings. “Since non-QM deals first appeared in 2014, their AAA spreads have tightened, suggesting that the market may be growing more comfortable with this asset class,” the rating service said. The spread measures the price of MBS tranches compared with a benchmark international swap rate. Tighter spreads indicate greater demand from investors ...

The share of cash-out mortgages in prime non-agency MBS has increased in recent years, prompting concerns from Moody’s Investors Service. The rating service noted that the cash-out refi share increased from around 1.0 percent in early 2012 to around 8.0 percent in the second half of 2017. The cash-out refi share has been even higher in some recent issuance. Such loans accounted for 14.9 percent of the $736.5 million deal JPMorgan Chase issued this week ...

With overall production levels falling, there was a modest increase in several risk vectors of FHA and VA loans pooled in Ginnie Mae mortgage-backed securities during the first quarter of 2018.A new Inside FHA/VA Lending analysis shows the average credit score for FHA loans in Ginnie MBS issued during the first quarter was 671.1, the lowest level since Ginnie began reporting loan-level data on its securities. That was down from 673.2 in the fourth quarter and 679.2 a year ago. Part of the slide in FHA credit scores likely reflects the increased share of purchase mortgages, which typically have lower scores than refinance loans. The same thing happened in the VA market, where average credit scores fell 1.1 points to 707.8 in the first quarter. A year ago, the average VA score was 710.2. Debt-to-income ratios also drifted higher, suggesting more risk of default. Among FHA loans, the average DTI rose to ... [Charts]