Angel Oak Capital Advisors issued a nonprime mortgage-backed security on Dec. 17 tied to loans with an unpaid principal balance of $150.35 million. It was the fourth – and largest – nonprime MBS issued in 2015. Angel Oak Mortgage Trust 2015-1 included a $120.28 million senior tranche, a $15.04 million mezzanine tranche and two subordinate tranches totaling $15.04 million. The deal was issued by Angel Oak’s Greenleaf Income Trust II and was not rated. Officials at Angel Oak said ...

The government-sponsored enterprises’ risk-sharing transactions more adequately address incentive problems than non-agency mortgage-backed securities, according to a recent report by the Office of Financial Research. The OFR said back-end risk-sharing transactions from Fannie Mae and Freddie Mac “indicate how private housing finance remains crippled.” The OFR is an independent office within the U.S. Treasury Department, focusing on financial stability issues. The GSEs sold ...

Risk-retention requirements established by the Dodd-Frank Act for certain non-agency mortgage-backed securities took effect at the end of 2015. Industry analysts suggest that the requirements will have minimal impact on industry participants’ current practices. “Risk-retention rules will not affect overall residential MBS issuance levels because qualified mortgage issuers will be exempt from risk-retention rules, and non-QM issuers already retain risk,” according to analysts at Moody’s Investors Service ...

The omnibus appropriations bill President Obama signed in December included a provision that supporters suggest will help spur reform of the government-sponsored enterprises. The bill prohibits the Treasury Department from selling its senior preferred shares in Fannie Mae and Freddie Mac until at least the start of 2018. “Passage of this provision makes it clear that Congress – which created mortgage giants Fannie Mae and Freddie Mac in the first place – should ... [Includes three briefs]

The supply of single-family MBS outstanding grew again in the third quarter of 2015, according to a new Inside MBS & ABS analysis. At the end of September, $6.381 trillion of single-family MBS were outstanding, a 0.7 percent increase from the second quarter. The market has moved in fits and starts since the end of 2009, but the September mark was the highest since the third quarter of 2013. The supply of non-agency MBS in the market has moved...[Includes two data tables]

Greenleaf Income Trust this week priced a $135 million non-agency, nonprime MBS, the largest such offering since the housing bust. It marks the second nonprime MBS sold in the past week, and the fourth deal of the year – all of them sold as private placements with no ratings. Mike Fierman, managing partner and CEO of Angel Oak Companies, which is affiliated with Greenleaf, told Inside MBS & ABS he’s pleased with the outcome of the security. “We had broad investor participation and the transaction was oversubscribed.” Fierman said...

The U.S. residential MBS sector will continue its slow, steady recovery in 2016 amid a host of challenges, showing further improvement in housing fundamentals, credit quality and mortgage performance, according to analysts. The challenges to MBS structured financing boil down to the following: tapering of Federal Reserve investment in MBS, MBS supply and demand, interest rates and prepayment risk. Fitch Ratings notes...

Subservicing shops increased their portfolios to $1.50 trillion during the third quarter, a 6.4 percent sequential gain, as mortgage originators continued to rely on such specialty vendors, according to exclusive survey figures compiled by Inside Mortgage Finance. Compared to a year ago, subservicing volume was up an impressive 28.2 percent. At Sept. 30, roughly 15.8 percent of all outstanding residential mortgages were being processed...[Includes one data table]

Investor demand for rated securitizations backed by re-performing and nonperforming mortgages is increasing both in the U.S. and in Europe, according to senior analysts at Moody’s Investors Service. The analysts noted a strong pipeline of RPLs in the U.S. securitization market as investors purchase NPLs and turn them into re-performing loans. Max Saury, a senior analyst with Moody’s Structured Finance Group, estimates the current NPL market at $300 billion, excluding nonperforming non-agency MBS. There have been...

A $56.26 million nonprime mortgage-backed security from Beach Point Capital is scheduled to close next week, according to sources close to the deal. RCO 2015-NQM1 Trust will be backed by mortgages originated by Citadel Loan Servicing, which will also service the loans. The deal will mark the third post-crisis MBS backed by newly originated mortgages, following two MBS from Lone Star Funds’ Colt Funding, including a deal issued last week. Nomura is the placement agent and seller ...