MBS and deposit activity at the top 25 U.S. commercial banks in 4Q06 showed solid MBS sponsorship, according to the JPMorgan Securities bank quarterly update.

Total MBS holdings increased by $16 billion and comprised $13 billion in passthroughs and $3 billion in CMOs, JPMorgan analysts reported. Year-over-year total bank holdings at these 25 banks surged by $70 billion, which doubled that of 2005, analysts said. Year-to-date, banks have bought another $10 billion in mortgage securities.

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