Non-agency MBS issuers repurchased only about a third of the defective loans they should have been required to buy back, according to a new analysis by Amherst Securities Group. The report quantifies a problem that has led to industry efforts – and new proposed federal regulations – to bolster industry practices related to representations and warranties. Amherst identified some...
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Former officials at Washington Mutual, one of the largest issuers of non-agency MBS during the market’s heyday, parried charges of misconduct in their mortgage securitization business during the first of four Senate hearings probing Wall Street’s role in the financial meltdown. Although the Senate Permanent Subcommittee on Investigations dug up hundreds... [Includes one chart]
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The volume of non-agency MBS issued during the first quarter of 2010 fell slightly from the end of last year, but the market saw its first Alt A transaction in nearly two years, and a new jumbo deal is said to be in the works. A total of $15.59 billion of non-agency MBS were issued in the first three months of the year, a 1.6 percent decline from the previous quarter... [Includes four charts]
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A proposal by the Securities and Exchange Commission to remove credit ratings references in shelf eligibility criteria may help ease investor fraud lawsuits against credit rating agencies, but litigation risk will still be high because of continued demand for credit ratings in other ABS transactions, according to market experts. Earlier this month, the U.S. District Court...
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Experts are optimistic about the future of non-prime MBS based on recent price gains in the sector and the outlook for government intervention in the overall housing market. These structured products aren’t without risks, but relative to the potential yield, they are showing high value compared to other assets. Non-agency MBS are trading 20-30 percent higher than their December 2008 levels...
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Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks held a combined $314.2 billion in non-agency mortgage securities at the end of 2009, as the government-sponsored enterprises watched their botched foray into the troubled sector gradually fade away. With few buyers and little stomach to absorb major losses on their investments, the GSEs have... [Includes one graph]
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Standard & Poor’s is rolling out a new analytical tool to give MBS investors and analysts improved transparency and granularity. The Global Data Solutions U.S. RMBS Edition features class- and deal-level data on subprime, Alt A and prime jumbo MBS, according to Kevin Smith, assistant product manager for the company’s global data solutions unit...
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