All 17 publicly traded REITs reported double-digit declines in their MBS portfolios during the first quarter, with six institutions now with portfolios less than $1 billion. (Includes data chart.)
Uncertainty regarding the performance of mortgages underlying its CRT in-vestments prompted PMT to boost the discount rate on its loans from just 5% at the end of the fourth quarter to about 11% as of March 31.
Designed to aid MBS issuers hurt by the pandemic, the Ginnie Mae PTAP has received high marks thus far. Details about usage could be released before the weekend starts.
Ginnie Mae came to the rescue of a handful of MBS issuers with its PTAP program. Meanwhile, Fannie/Freddie issuers needing cash because of the pandemic have some new options, but will they be used?
The coronavirus economic assistance package is signed, sealed and delivered but concerns remain over the ability of nonbanks to pay MBS holders in the event delinquencies spike over the short term.
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.
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