Bank investments in vintage non-agency mortgage-backed securities have increased recently due to a number of factors specific to the sector as well as broader economic issues. However, Standard & Poor’s warned last week that some banks are increasingly relying on non-agency MBS to prop up earnings, which could lead banks to take even further risks with their non-agency investments and hedging. “If this occurs in a significant manner, we could lower our ratings on a bank that is undertaking such activity,” the rating service said ...