Nearly $320 billion of newly originated home loans were funneled into the MBS market during the second quarter, but that represented just 56.4% of new production in the primary mortgage market.
DBRS and Fitch were the top rating services in non-agency MBS mostly because they cover a lot of scratch-and-dent transactions. S&P excels in nonprime, Moody's in jumbo.
The conforming-jumbo business might be an attractive target for shrinking the GSE footprint as the loan limit is poised to top $500,000. But it's not clear it would de-risk Fannie/Freddie business.
In terms of new HELOC commitments for the second quarter, Bank of America led the pack with $2.77 billion, followed by Wells Fargo ($1.91 billion) and Citizens Bank ($1.50 billion).
Most of the industry's pullback in ABS holding resulted from portfolio trimming by the three largest bank investors. Total ABS outstanding rose sharply in the second quarter.
Year-to-date CLO issuance lagged behind the pace set in 2018 because of a slowdown in refinance transactions. Octagon Investment Partners was the most active sponsor at midyear.