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RMBS

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  • The Federal Reserve increased its purchase of agency mortgage-backed securities to $7.7 billion in the week ending March 21, up from $6.4 billion in the preceding week.
  • Wells Fargo has imposed a 105% limit on the loan-to-value ratio it will accept from third-party lenders on loans through the government’s latest version of the Home Affordable Refinance Program.
  • The U.K.’s Financial Policy Committee, its new systemic risk regulator, is seeking the authority to change bank capital requirements according to economic cycles, namely to raise requirements on financial institutions against unexpected losses in a healthy economy and then lower them in a downturn.
  • New tougher capital requirements on Spanish banks may be harsh but are also necessary, according to Fitch Ratings.
  • The Spanish government’s new voluntary code of practice for mortgage lenders, introduced earlier this month, may protect borrowers in danger of falling into arrears but could have a negative impact on the credit quality of residential mortgage-backed securities as it could lead to lower collateral yields, increased repossessions and higher losses on mortgage loans, according to Standard & Poor’s.
  • FIG
    The core sectors of the European ABS market, such as prime RMBS and autos, continue to spark investor interest in both the primary and secondary market.
  • Fitch Ratings has downgraded 354 distressed bonds in 156 U.S. residential mortgage-backed securities transactions from Csf and CCsf to Dsf, suggesting greater possibility of default.
  • A BWIC (bids wanted in competition) built mostly of bonds from Bradford & Bingley’s U.K. buy-to-let and non-conforming residential mortgage-backed program Aire Valley Master Trust surfaced on Thursday.
  • Players across the securitization sector say a re-emergence of monoline wrappers in the new-issue market is still far off, dismissing speculation that Goldman Sachs might be readying a monoline insurance business plan.