Banks’ Retention of Conforming Mortgages Likely Driven by High G-Fees, Shift in Lenders
October 15, 2015
In the past year and a half, banks have started holding an increasing share of conventional conforming mortgages in portfolio instead of securitizing them through the government-sponsored enterprises. Industry analysts suggest GSE guaranty fees are the reason. In the first half of 2015, 91.6 percent of the estimated $442 billion in originations of conventional conforming mortgages were included in mortgage-backed securities. In 2013, 97.0 percent of the estimated $1.17 trillion in conventional conforming originations were securitized, according to an Inside Mortgage Finance analysis. “Securitizing conforming mortgages in agency MBS has become...