Pacific Western Bank started acquiring residential mortgages in March 2021. PacWest is now done acquiring loans and looking to share credit risk on a pool with an unpaid principal balance of $2.68 billion.

Delinquencies on expanded-credit MBS are increasing but investors in the deals appear to be protected at the moment. A review of the sector by Fitch prompted many upgrades and no downgrades.

Rising rates are putting pressure on both lenders and borrowers. Meanwhile, with originations constrained consolidations should increase.

Interest rate hikes look to be a necessary evil, according to BofA CEO Brian Moynihan...

KBRA says the residential MBS market has many features that reduce the correlation between lender failure and future loan performance...

PacWest's non-agency credit risk transfer is planned as a one-off, with the bank acquiring loans from various lenders

The loan limit hiking club includes Rocket Mortgage, UWM, PennyMac and others...

The correspondent channel gained market share in the jumbo sector in the second quarter. The retail channel, though, remained the predominant source of jumbos, with strong competition in the channel among banks. (Includes data chart.)

Spreads had steadily widened in the expanded-credit sector between February and July. But as spreads declined in August, demand for expanded-credit MBS appears to have improved.

MISMO is getting close to releasing revised standards for data collection in the non-agency MBS market. The effort could prompt efficiencies for lenders, due diligence firms and rating services.