The Federal Housing Finance Agency Office of the Inspector General said the FHFA needs to focus on improving its oversight of the GSEs and Federal Home Loan Banks in several key areas. In fact, the FHFA faces four “serious” management and performance challenges that carried over from prior years, according to a recently published OIG memo to FHFA Director Mel Watt. The OIG is troubled by the agency’s supervision of the GSEs and said it needs to improve oversight of matters delegated to Fannie Mae and Freddie Mac, as well as make its internal review process for non-delegated matters stronger.
The Federal Reserve Board’s Community Advisory Council and the Board of Governors said the current mortgage finance system doesn’t provide fair access to large segments of the population.They also noted that there’s a critical need to resolve the ongoing conservatorship. Members of the two groups held their semiannual joint meeting earlier this month and discussed the need to reform the housing finance market so that low to -moderate income borrowers aren’t left out.The council talked about the need to disaggregate economic data to understand the disparities that exist in mortgage lending, especially among minority groups.
Fannie Prices $1.2B CAS Deal. Fannie priced its seventh credit risk-sharing transaction of 2017 under its Connecticut Avenue Securities program. CAS Series 2017-C07, a $1.161 billion note offering, is scheduled to settle on Nov. 21, 2017, and is the final deal of the year. It was met with strong investor demand, including new investors, according to Laurel Davis, Fannie’s vice president of credit risk transfer. “Investors continue to provide us with positive feedback on the transparency we provide as part of our CAS program, including our response to recent hurricane events and the information we make available in Data Dynamics, our analytical tool for investors. We expect to continue regular benchmark issuance of CAS notes in 2018, subject as always to market conditions.”
Mortgage lenders that sell single-family loans into Fannie Mae and Freddie Mac mortgage-backed securities continued to stretch the credit envelope during the third quarter, a new Inside Mortgage Trends analysis reveals. But the increase in the share of higher-risk lending is still going at a glacial pace, and low-risk mortgages continue to dominate the government-sponsored enterprises’ business. During the third quarter, mortgages in the lowest ... [Includes two data charts]
Industry stakeholders are increasingly dour on the prospect of Federal Housing Finance Agency Director Mel Watt acting to rectify the government-sponsored enterprises’ capital buffer issue before yearend, but there’s growing hope that bipartisan reform legislation might be enacted next year.
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