The transition away from the London Inter-bank Offered Rate could prompt significant tax issues for MBS and ABS investors. The Structured Finance Industry Group wrote to the Internal Revenue Service and Treasury last week requesting guidance on the issue. LIBOR won’t be available after 2021 and market participants are looking for an alternative reference rate. Various securities are tied to the London benchmark rate in terms of the loans that back the deals and their ...

Thanks to rising long-term interest rates, the negative yield curve that investors fretted about two weeks ago has been snuffed out, causing some market watchers to worry less about a coming recession. As Inside MBS & ABS went to press, the yield on the benchmark 10-year Treasury was at 2.51%, compared to 2.33% for the two-year and 2.44% for the three-month T-bill. As recently as March 25, the 10-year was at 2.36%, lower than short-term rates. Opinions differ, but some analysts ...