Investors can’t seem to get enough non-agency MBS. Issuance is booming and demand is expected to remain elevated thanks to the outlook for interest rates, among other factors.
MBS trading has improved as investors and traders weigh the landscape. One positive: a benign inflation reading this week. But is this a head fake before worse news appears?
The flow of refinance loans into the Ginnie MBS program dropped 9.2% in April. Still, year-to-date refi volume in the government-insured market was up a solid 54.4%. (Includes two data tables.)
Non-agency MBS issuance more than doubled on a sequential basis in the first quarter of 2024, with jumbo mortgages making up the majority of loans in the deals. (Includes three data tables.)
“This is the most attractive time to be acquiring residential loans since I started in the market in 1991,” said Carl Bell, a senior managing director at Invictus Capital Partners.
A proposal from FINRA to reduce the timeframe in which trades of MBS and ABS must be reported didn’t sit well with some industry participants, prompting the SEC to take a closer look at the proposal.
Issuance of MBS backed by expanded-credit mortgages increased by nearly 50% from the fourth quarter to the first quarter of 2024. Annaly more than tripled its volume.
New jumbo, expanded-credit and home equity loan securitizations were announced over the last two weeks. The largest offerings are two jumbo MBS from JPMorgan Chase.
Sam Valverde, Ginnie Mae’s principal executive vice president, will serve as acting president, while Laura Kenney, senior advisor for strategic operations, will assume additional duties.