Ginnie Mae's recent proposal to build a $60 billion portfolio of its own mortgage-backed securities met some disapproval last week at the Mortgage Bankers Association's annual convention, where representatives from both Fannie Mae and Freddie Mac criticized the proposal on the grounds that Ginnie Mae does not have the capability to manage the risks of a MBS portfolio.

However, Ginnie Mae officials defended the plan, saying that the GSE needs its own investment portfolio in order to support its MBS.

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