Finance

The mortgage market has begun the long and arduous process of crawling from the wreckage of the last two years. While the government has been involved in mortgage lending since the 1930s, recent recovery efforts have resulted in a massive intervention in the mortgage sector to both support the financial system and keep mortgage money flowing to the housing markets. However, the government's involvement in mortgage lending will be difficult to end without renewed disruptions to the financial and housing markets. Whether they know it or not, they are in for the long haul. With a long-term recovery in housing as the ultimate goal, they need to examine some of the distortions stemming from the government's traditional role in mortgage and MBS markets.

Jon Bass, head of the U.S. fixed income group at UBS, has resigned. A source familiar with the firm confirmed reports of the credit chief’s resignation.

New homes sales fell nearly 15% in December from November to a level not seen since 1981 as builders wait to see what Congress is going to do to help the housing market.

The House has passed the $820 billion economic stimulus bill that restores the $729,750 loan limit in high cost areas for the rest of this year.

The U.K. government's proposed £2.5 billion ($3.5 billion) support package for the U.K. auto industry is unlikely to have any impact on the ratings of outstanding auto-related ABS, according to analysts at Fitch Ratings.

Freddie Mac reported its 30-year fixed mortgage rate slipped just two basis points to 5.10% this week, while 15-year fixed rates were unchanged at 4.80%.

The Pennsylvania Office of Attorney General said it has reached a $150 million settlement with Countrywide Financial Corp. to obtain mortgage relief and cash assistance for thousands of Pennsylvania residents with subprime loans sold through Countrywide.

Invesco PowerShares Capital Management has filed registration statements for two new actively managed ETFs focused on the non-agency, prime and Alt-A RMBS markets.

Rapidly deteriorating employment conditions are propelling losses on card receivables into unfamiliar territory.

London-based fund manager Threadneedle Asset Management hired five people from Babcock & Brown's ABS bond unit.

The Federal Housing Finance Agency (FHFA), which has just instituted a final rule on the dollar size of Fannie Mae and Freddie Mac's on-balance sheet holdings, also is seeking comment from the industry regarding what criteria should govern their holdings in the future once they return to health.

The Mortgage Bankers Association (MBA) is trying to get the Obama administration interested in a bifurcated refinancing program that the Treasury Department could implement using funds for the Troubled Asset Relief Program (TARP).

Cramdown legislation pending in Congress could cause a "substantial" surge in bankruptcy filings by consumers, including mortgagors who are currently paying their loans, according to a new report by Friedman Billings Ramsey (FBR).

Fannie Mae estimates it will ask the U.S. Treasury for $11 billion to $16 billion in funds to cover fourth-quarter losses and maintain a positive net worth.

Broadpoint DESCAP, the MBS/ABS security trading division of Broadpoint Capital, New York, has launched a new repurchase desk and expanded its structured products group.

The German finance ministry is still considering enlarging the support for the banking sector, according to market reports.

The impact of the continuing U.K. housing market downturn will have a minimal impact on the ratings of UK prime RMBS, said Fitch Ratings today in a report.

While remaining steadfast in their opposition to "cramdowns," the Mortgage Bankers Association (MBA) acknowledges that supporters are gaining momentum and the trade group has outlined parameters it would like to see included in legislation that would allow bankruptcy judges to reduce the secured portion of a mortgage loan.

Following its acquisition by Bank of America, Merrill Lynch has cut two top guys from its Asia-Pacific debt capital markets team: Ajay Sawhney, head of Asian leveraged finance, and Jon Pratt, head of Asia debt capital markets outside Japan and Australia.

Standard Chartered Bank today announced the appointment of Zubaid Ahmad as vice chairman, head of corporate finance, Americas, based in New York.