Ginnie Mae's issuance of mortgage-backed securities exceeded Fannie Mae's issuance in May for the first time since the late 1980s.

Ginnie Mae securitized $37.5 billion in single-family loans in May, edging out Fannie for top honors. Fannie issued $37.1 billion in MBS, while Freddie Mac issued $28.7 billion, according to an eMBS flash report.

A surge in refinancings of Federal Housing Administration loans helped Ginnie reach its new milestone. FHA reduced its annual mortgage insurance premium by 50 basis points in late January.

"It will be interesting to see what June and July look like" as the FHA surge runs its course, said Ted Tozer, president of Ginnie, in an interview.

He expects Ginnie issuance will come down relative to Fannie "but not by a whole lot."Tozer said FHA purchase loan volume should remain strong relative to Fannie and Freddie.

"Our 30-year fixed-rate issuance has been comparable to Fannie for the last 18 months," Tozer said.

However, demand for Fannie's 15-year product generally keeps the mortgage giant ahead of the pack.

The Department of Veterans Affairs and FHA offer 15-year mortgages but their borrowers mainly apply for 30-year loans. (Ginnie Mae securitizes FHA, VA and Rural Housing Service loans.)

Meanwhile, Tozer is hoping the Federal Home Loan Banks will provide a new and lasting boost for the Ginnie program. The Chicago Home Loan Bank is expected to issue its first Ginnie Mae MBS this summer.

Ginnie Mae pioneered the securitization of mortgages and issued the first MBS in 1968. Fannie issued its first MBS in 1981.

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