The Office of the Comptroller of the Currency’s denial of favorable capital treatment to a non-agency MBS issued by JPMorgan Chase last year could hinder efforts aimed at convincing banks to return to the non-agency MBS market, according to industry analysts. JPMorgan Chase issued two unique non-agency MBS last year with a total unpaid principal balance of $4.53 billion. The so-called portfolio risk-transfer deals accounted for a whopping 48.6 percent of the prime non-agency MBS issued in 2016. Chase packaged...

Rating services appear to be taking differing approaches to rating nonprime MBS backed by new originations. The first nonprime MBS from an affiliate of Invictus Capital Partners received preliminary AAA ratings from Kroll Bond Rating Agency, Morningstar Credit Ratings and S&P Global Ratings. Those three firms did not rate...

JPMorgan Chase is preparing to issue another large non-agency mortgage-backed security, but the deal includes some significant differences compared with the two large portfolio risk-transfer MBS the bank issued last year. The biggest change is that Chase appears to be planning to sell most of the MBS to investors. On the two large portfolio risk-transfer MBS that Chase issued in 2016, the bank retained about 90.0 percent of the issuance. At the time, Chase officials cited ...

The first nonprime mortgage-backed security from an affiliate of Invictus Capital Partners will be stocked with loans that have some unique features. Kroll Bond Rating Agency, Morningstar Credit Ratings and S&P Global Ratings placed preliminary AAA ratings on the deal last week. The planned $145.02 million Verus Securitization Trust 2017-1 differs in a number of ways from the $225.75 million COLT 2016-3 Mortgage Loan Trust, the nonprime MBS from an affiliate of Lone Star Funds ...

An affiliate of Galton Funding is preparing to issue a non-agency mortgage-backed security that will include non-qualified mortgages, according to documents filed with the Securities and Exchange Commission. Galton Funding acquires mortgages on a correspondent basis. The firm is part of Galton Capital Group, which is the residential mortgage investment group within Mariner Investment Group. Mariner is a New York-based investment advisor that manages about ...

Fitch Ratings recently assigned “average” assessments to three originators and aggregators involved in the nonprime mortgage market, the same grades the firm assigned to Caliber Home Loans. Fitch evaluated Angel Oak Home Loans, Angel Oak Mortgage Solutions and Citadel Servicing as originators of nonprime mortgages. And the rating service reviewed Deephaven Mortgage as an aggregator of nonprime mortgages. The assessments by Fitch will help pave the way for ...

Invictus Capital Partners, an investment management firm, started aggregating nonprime mortgages in August 2015. The firm has purchased more than 400 mortgages and has plans for further growth. Invictus aggregates mortgages through an affiliate, Verus Mortgage Capital. Verus is set to issue its first nonprime mortgage-backed security – a $145.02 million deal that’s scheduled to close on Feb. 22. Verus has acquired $300.0 million of nonprime mortgages, according to ...

Only 69.1 percent of home mortgages originated in 2016 wound up in agency or non-agency MBS issued last year, according to a new Inside MBS & ABS analysis. It was the second-lowest annual mortgage-securitization rate on record, and the third year in a row that the rate failed to reach the 70.0 percent mark. The low securitization rate mostly results from the fact that relatively few jumbo mortgages get out of bank portfolios and into the non-agency MBS market. According to Inside Mortgage Finance estimates, some $381.0 billion of jumbo mortgages were originated...[Includes one data table]

Analysts at DBRS anticipate some notable changes in the residential mortgage securitization market this year, mostly as a result of expected higher interest rates. “Despite a healthy housing market recovery, post-crisis non-agency RMBS issuance has remained stagnant for several reasons,” said Quincy Tang, managing director of RMBS structured finance, in a new research report issued early this week. In addition to the dominance of Fannie Mae and Freddie Mac and bank balance-sheet capacity, “a persistently low interest rate environment has rendered...

Invictus Capital Partners, an investment management firm, is preparing to issue a nonprime mortgage-backed security backed by newly-originated home loans from four different lenders, according to documents filed with the Securities and Exchange Commission this week. Covius, a due diligence provider, said it reviewed mortgages with an unpaid principal balance of $118.96 million for the planned Verus Securitization Trust 2017-1. The bulk of the contributions for the MBS were ...