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Inside MBS & ABS

August 13, 2010

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Agencies Begin Looking for Alternatives to Credit Ratings in Determining Capital Risk Weights

Federal banking agencies are considering returning to a much simpler approach to setting risk-weighted capital requirements for bank MBS and ABS holdings that would likely result in higher capital standards for most non-agency securities. The Dodd-Frank Wall Street Reform and Consumer Protection Act requires the banking agencies to... Read More

Industry Groups Tell SEC They Favor Stronger Reps And Warranties Enforcement, Suggest Alternatives

Mortgage industry trade groups are behind stronger enforcement of representations and warranties, especially when it comes to MBS transactions, but they say a Securities and Exchange Commission plan – part of its proposed update of Regulation AB – isn’t quite up to the task.“Our investor members strongly favor... Read More

NY Fed Joins Campaign to Make Securitization Parties Repurchase Bad Loans from MBS, CDOs

The Federal Reserve Bank of New York has joined the parade of investors and other parties stuck with cleaning up the debris from the non-agency MBS meltdown that are trying to force issuers and other parties to those transactions to buy back bad loans. The Fed’s interest in the issue stems from... Read More

Sources Still Dry for Non-Agency Collateral, Barclays Say, Securitization Doesn’t Work

The non-agency MBS market will come back someday, but it will probably look different and the re-bound is still some distance off in the future, according to a new Barclays Capital analysis. “While any new securitizations will get increasing focus in coming quarters, we believe... Read More

Bulk of Fannie, Freddie Delinquent Loan Purchases Out of Pools Now Complete

Fannie Mae and Freddie Mac have now done most of the heavy lifting when it comes to purchasing delinquent mortgage loans out of their MBS pools, with Fannie being particularly active during the second quarter of the year. “The company purchased approximately 858,000 delinquent loans with an unpaid principal balance of..." Read More

GSEs Hold Fewer Mortgage Securities in Portfolio As Non-Agency Product Slowly Winds Down

Although Fannie Mae and Freddie Mac are supposed to be letting their mortgage-related portfolios gradually decline, the combined holdings of the two government-sponsored enterprises have actually increased over the first half of 2010. The two GSEs held some $1.557 trillion of mortgages and MBS in portfolio as of the end of June, an increase of... [Includes one data chart] Read More

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