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’Deutsche Bank on the perfect mortgage company
Foreclosure fraud! Robosigning! Repurchases!
How, as Mike Konczal noted a couple weeks ago, did mortgage servicers get it so wrong?
To answer the question it’s worth taking a look at a certain mortgage firm that may have got it right.
MBS trade settlement failures hit record
Something’s afoot in the Mortgage-Backed Securities (MBS) market.
After this week’s drop-off in secondary market trading for private-label residential MBS, comes Friday’s news that MBS trade settlement failures reached a record:
The outing of the Robo-Signer conference attendees
Wednesday morning. New York. The Robo-Signers Conference.
Hosted at the swanky Core Club on on East 55th Street this was not an event for the Robosigners themselves — the foreclosure document-signing recruits who sparked a wave of industry uncertainty.
MBS trading takes a time-out
A datapoint from the world of Mortgage-Backed Securities (MBS) trading.
The debate over whether — and if so, how — mortgage issues in the States will affect the secondary market for private-label residential MBS has raged for some time now.
MERS casts its shadow on commercial mortgages
Barclays Capital analysts have done it.
They’ve linked Mortgage Electronic Registration Systems Inc — currently making headlines in US residential mortgages — to the commercial mortgage market.
And specifically,
A rocky road to yield
A data point, in the relentless search for yield.
The bottom tranches of Granite — the mortgage securitisation vehicle of Northern Rock — crossed the 50 price level for the first time last week. This is,
Performing PPIFs
The Public-Private Investment Program, or PPIP — do you remember it?
Appropriately, given its somewhat Dickensian name, it was like the orphaned child of banking stabilisation measures. Associated with a difficult early period of the Tim Geithner reign,
One size does not fit all in ABS risk, Fed says
Risk retention requirements for Asset-Backed Securities *yawn.*
But the 96-page report released by the US Federal Reserve this week — outlining the potential impact of risk retention on ABS — makes for interesting financial crisis forensic reading.
Turn of the (MBS) trustees
Bank of New York Mellon may have been the other addressee in that Pimco, New York Fed, BlackRock et al letter regarding $47bn in RMBS — but it’s managed to escape much of the limelight shining on co-addressee Bank of America.
Those blemished Countrywide credit loans
So… since FT Alphaville was working on a special RMBS supplement;
We spoke with Scott Simon, head of MBS at Pimco last week — who gave us this quote:
“There’s been an amazing amount of things
Bondholders vs BofA, continued
Just a few additional items we’d like to record that might shed some light on the still-developing story that MBS investors were pressuring BofA to repurchase mortgages the bank had sold them.
First,
BlackRock, Pimco, NY Fed coming after BofA, Bloomberg says
No sooner does Bank of America announce earnings than it gets hit with a significant threat of legal action from mortgage bond holders – including the New York Fed. From Bloomberg:
Pacific Investment Management Co.,
A stab at securitisation
Some weekend foreclosure scandal, securitisation-related reading.
It’s based on a 159-page class action lawsuit, filed in Kentucky on behalf of all Kentuckian homeowners, and against MERS and several financials.
Taxing times for MBS
Back in the 1980s — when Lewis Ranieri was still fighting for the legal status of MBS — something seminal happened for the mortgage securitisation market.
The Tax Reform Act was passed by the US in 1986,
Sacrificing servicers on the altar of Hamp
We like to think of the foreclosure scandal as Hamp on super-steroids, with a hefty dose of litigation and structured finance for added fun.
Recall that the US administration’s mortgage modification program was aimed simply at keeping people in their houses.
The MBS mess from the beginning – the deal docs
Mike Konczal at Rortybomb, has a quick rebuff for anyone who thinks the foreclosure scandal is creating a mountain out of a molehill (of mortgage paperwork).
It’s this pooling and servicing agreement for GSAMP Trust 2006-FM1.
MERS, an acronym of mass foreclosure destruction
Financial ‘innovation’ coming back to haunt the system is something we are familiar with.
But do welcome a new toxic acronym to the stable — MERS — that’s Mortgage Electronic Registration Systems Inc.
The Fed, and what to do about MBS
Not that the Fed has ever been a model of clarity and decisiveness, but the announcement in August that it would re-invest proceeds from its MBS holdings into long-dated Treasuries left open a few questions:
Oops, MBS settlements failing again
Oh dear.
After reversing their upward trajectory of late, MBS trade settlement fails in the US primary dealer repo market picked up rather forcefully last week.
This, for example, is how the latest primary dealer data survey from the New York Fed showed fails to deliver and receive coming in respectively:
How low can they go?
Another day, another set of lows in 10-year Treasury and bund yields:
In bund yields specifically, we might add that these are record lows for both the 10-year and 30-year yields — which on Friday struck 2.273 per cent and 2.957 per cent respectively.
That cornered – failing – MBS market
Fails to deliver — to the moon!
That’s trade settlement failures in mortgage-backed securities (MBS) — the most liquid US bond market after US Treasuries — and they’ve spiked this summer. The fails occur when the MBS seller fails to deliver on an agreed upon settlement date.
Politics by default
Take pity on Republican Congressman Mario Diaz-Balart.
The man in charge of Florida’s 25th congressional district has just been singled out by Deutsche Bank as the US Congressional representative with the hardest-hit constituency in terms of mortgage arrears.
The $11.1bn buyback pain at BAC
A sharp-eyed spot over at American Banker.
They’ve noticed this little section from Bank of America’s recently filed second-quarter 10-Q:
Although the timing and volume has varied, repurchase and similar requests have increased from buyers and insurers including monolines.
Hamp – it’s worse than we thought
So the US Treasury’s centrepiece mortgage modification programme — Hamp — is something of a failure. That much we knew already.
But Laurie Goodman over at Amherst Securities brings up another point.
What the Fed can’t buy
So the Federal Reserve will be buying more US Treasuries, using run-off proceeds to do so.
According to its release, the Fed plans to buy longer-dated USTs in the two-year to 10-year segment.
But the central bank still won’t be buying more than 35 per cent of any single issue.
The Fed’s QEII: What the pundits say
Some commentators and analysts have lauded the Fed’s Tuesday decision to begin reinvesting more than $150bn in annual proceeds from maturing mortgage-backed and agency securities into Treasury debt.
But others echo the suggestion of the FT’s Lex column,
Pondering the MBS paydown stimulus
Amongst the additional stimulus measures being pondered by analysts ahead of Tuesday’s FOMC meeting is a possible quantitative move which would see the Fed reinvest paydowns from its MBS portfolio back into the sector or by buying Treasuries.
The Great Mortgage Refinancing, by the numbers
Deutsche Bank have returned with some numbers to back up their cost claims when it comes to the Great Mortgage ReFi Rumour of August 2010.
Analyst Steven Abrahams noted last week that “hitting that reset button”
Chorus of QE calls is deafening
After the US payrolls come the QE-cries.
Analysts and economists seemed to be falling over themselves over the weekend in their haste to call for more unconventional monetary policy ahead of the Federal Reserve’s meeting on Tuesday.