A soft fourth quarter resulted in a modest uptick in non-mortgage ABS in 2016, according to a new Inside MBS & ABS ranking and analysis. A few sectors posted solid gains, however. The market produced $174.71 billion of new ABS last year, up just 0.6 percent from the total for 2015. New issuance turned decidedly soft in the fourth quarter with only $34.24 billion in volume. That was down 36.7 percent from the previous period and represented the second-lowest quarterly output since the third quarter of 2012. All the major components of the ABS market saw...[Includes two data tables]
Moody’s Investors Service agreed to a $863.79 million settlement with the Department of Justice, 21 states and Washington, DC, late last week. The settlement focused on rating activities between 2004 and 2010 involving residential MBS and collateralized debt obligations. According to the settlement, Moody’s used an internal ratings model for most tranches of certain residential MBS that was more lenient than its published guidelines, allowing for lower credit enhancement levels than what the published guidelines required. The internal model was based...
International Value Advisors recently cut its stake in Annaly Capital Management – the nation’s largest mortgage real estate investment trust – by roughly half, a development that could be repeated by other investors as rising rates cause new concerns about MBS prices. At year-end, International owned 4.55 percent of Annaly compared to 9.60 percent a year earlier. Annaly’s largest investment is in agency MBS, of which it owned $73.5 billion at Sept. 30. The publicly traded REIT is...
As a number of shareholder lawsuits against Fannie Mae and Freddie Mac hang in the balance, a new administration offers reasons for some to be optimistic on the cases coming to a close and the Treasury’s sweep of the government-sponsored enterprises’ profits coming to an end. During a Jan. 18 call hosted by Investors Unite, legal experts weighed in on the outlook for GSE shareholder cases just days before the inauguration. Plaintiffs have been arguing that a government bailout of the GSEs and the subsequent Treasury sweep was unnecessary and illegal. “As GSE shareholders, we are...
The residential MBS market is expected to be healthy this year, according to some ratings service analysts. But the new president is the big unknown, market participants say. According to analysts at Fitch Ratings, the rating outlook for U.S. RMBS they rate is auspicious, as they expect asset performance trends to stay positive thanks to support from solid, if somewhat uneven, gains in home prices. “Although a number of legacy transactions continue to face negative rating pressure due to declining loan counts and tail risk, rating upgrades outnumbered...
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