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Inside MBS & ABS

September 18, 2009

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FDIC Inks First PPIP Transaction for Mortgage Loan Sales, Securities Deals Expected in Coming Weeks

The Federal Deposit Insurance Corp. this week completed its first disposition of “troubled assets” in a trial run for the Obama administration’s Public Private Investment Program, with a ramped up version for MBS and ABS sales expected to take wing at the end of September. The PPIP was designed to use taxpayer money from last year’s Troubled Asset Relief Program legislation to boost... Read More

Industry Raises Concerns About Government Plan to Bring Bank Capital Rules in Line With New Accounting

Banks that rely on asset securitization will likely face a double whammy from new accounting rules on securitization and parallel efforts by federal regulators to overhaul bank capital rules, although it’s not clear whether the changes will have much impact on garden-variety MBS production. Federal regulators this week formally published a notice of proposed rulemaking that would... Read More

S&P Issues Revised Criteria for Rating 2008 Deals, New RMBS Transactions

Standard & Poor’s has finalized proposed changes to rating non-agency residential MBS that are expected to result in a credit enhancement strong enough to allow AAA-rated securities to endure the most severe market downturn. These criteria changes represent a significant departure to previous methodologies and assumptions for determining credit enhancement levels for RMBS transactions backed... Read More

RMBS Market Facing Challenges, but Recovery In Sight With ‘Glimmer at the End of the Tunnel’

Recent projections show a bottoming out of some economic indicators, but the securitization markets will continue to struggle into 2010 or 2011 before pulling out of the downturn, experts noted in secondary market reports this week. A structured finance team at Moody’s Investors Service led by Managing Director Warren Kornfeld said unemployment and house price trends are the key drivers of when... Read More

Bank MBS Holdings Continue Climbing in 2Q09 Despite Mixed Trends Among Largest Firms

Commercial banks continued to boost their investment in mortgage-backed securities during the second quarter of 2009, although the rate of increase was slightly below the overall growth in the MBS market. Commercial banks held some $1.131 trillion of MBS in their portfolios at the end of June, according to recently released data from the Federal Deposit Insurance... [Includes three charts] Read More

MBS Supply Expands in 2Q09 as Securitization Takes a Bigger Share of the Mortgage Market

The overall home mortgage market declined again in the second quarter of 2009, but a surge in agency MBS issuance more than offset the continued evaporation of the non-agency MBS sector. A total of $6.928 trillion of residential MBS were outstanding in the market at the end of June, according to a new Inside MBS & ABS analysis. That was up... [Includes one chart] Read More

Federal Efforts to Help Fannie and Freddie May Undermine Initiative to Move Them Off the Dole

The terms of the conservatorship that’s keeping Fannie Mae and Freddie Mac in business may also hamper Washington’s ability to put the government-sponsored enterprises back on their own feet, according to a new report issued by the Government Accountability Office. “Since the beginning of the Federal Housing Finance Agency conservatorships, the enterprises have been tasked to initiate a... Read More

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