Finance

Market participants believe the availability of new mortgage production is an obstacle to QE3 despite Federal Reserve Chairman Ben Bernanke's supportive comments in his semi-annual congressional testimony on Tuesday, BNP Paribas MBS analysts said in a report released yesterday.

The standardization of future CLOs' defined terms and structural features can hasten the sector's primary issuance process, Fitch Ratings said in a note released this morning.

A proposal by San Bernardino County to use eminent domain to seize, and then restructure, underwater private-label mortgages would result in more than just losses to private investors. Fannie Mae, Freddie Mac and the Federal Home Loan Banks are also in major investors in private-label securities and they too would suffer if the county took over what is estimated to be 150,000 underwater mortgages.

Citigroup analysts in their Consumer ABS Weekly published today examined the near-term impact of the interchange settlement on credit card master trusts and determined it was marginal.

The Securities Industry and Financial Markets Association (SIFMA) has reached a consensus on the issue of cities using their power of eminent domain to refinance underwater mortgages (using reducing principal reductions) that reside in private-label MBS, saying it will foul up the securitization process.

The Consumer Financial Protection Bureau's (CFPB) first-ever enforcement action Wednesday — hitting Capital One over card marketing practices — carried a pair of messages for the industry as a whole.

Spain’s Royal Decree Law 20/2012, which became effective on July 14, allows covered bonds to be backed by loans that finance export as well the as international expansion of Spanish firms. The new law offers further proof that the country’s banks have much fewer options in terms of traditional assets to support these bonds.

Thanks to continued, ultra-low interest rates, Freddie Mac is feeling quite bullish about loan production for the remainder of 2012, hiking its origination forecast by $200 billion to $1.65 trillion for the year.

The Prestwick Mortgage Group is marketing a $58 million package of mortgage servicing rights backed by mostly multifamily commercial mortgages held by private investors.

Freddie Mac reported new record lows along 30- and 15-year fixed mortgage rates as well as 5/1 hybrid ARMs for the week ending July 19. Both 30- and 15-year rates declined three basis points to 3.53% (no -point rate at 3.71%) and 2.83%, respectively. Meanwhile, 5/1 hybrids fell five basis points to a 2.69% average which matches this week's one-year ARM rate.

Western Asset Mortgage Defined Opportunity Fund’s public-private investment fund or Master Fund was terminated on July 15.

The U.S. Department of Housing and Urban Development (HUD) will now be accepting applications for qualified entities to purchase severely troubled loans that were formerly insured by the Federal Housing Administration (FHA) through the Distressed Asset Stabilization Program.

The slow down in consumer spending seen recently can mean that credit card balances remain flat for the foreseeable future, according to Bank of America Merrill Lynch analysts.

Oak Hill Advisors said it held the final closing of its European distressed debt and restructuring fund, hitting its cap of $1.35 billion.

Walker & Dunlop will be opening its twelfth national office in Madison, WI, making it the second location in the state. Michael Lee and Matthew Lund will be vice presidents in the new office and will focus on the financing of all types of income-producing properties.

Syncora Holdings announced on July 17 that its unit Syncora Guarantee had settled claims related to RMBS with Countrywide Financial Corp., Bank of America Corp. and their affiliates.

It appears that Redwood Trust—until recently the only securitizer of jumbo mortgages in the nation—has company in the space: Credit Suisse First Boston. But don’t pop the champagne quite yet. It’s not what you think.

If several California cities move ahead with a plan to seize underwater mortgages, they could end up paying more for the loans they expected, according to a legal expert retained by the Securities Industry and Financial Markets Association (SIFMA).

Another report of new lows in mortgage rates led to a 22% surge in the MBA's Refi Index to ~5331 for the week ending July 13, just under its mid-June high since April 2009 of 5386. As a percent of total application activity, refinancing share rose to 80.1% from 77% in the prior report.