Capital markets

Institutions can borrow against par-valued securities that they would otherwise have to sell at a loss when there's a run on deposits, and it could have effectiveness beyond its actual usage.

The new fees based on the DTI, which lenders have said is too likely to vary throughout the origination process for a single loan, will now go into effect in August.

Mortgage-backed securities aren't generally considered risky assets, but how SVB managed them contributed to its woes.

The government-sponsored enterprises will likely have their mainstay bonds exempted from the potential securitization-related rule, but their credit-risk transfers could be subject to it, some experts say.

Lee invested more than $15 billion in hundreds of transactions as of 2020. That included his best-known transaction, the 1992 purchase of Snapple Beverage Corp.

In the US, some loans include blacklists, which name specific funds that aren't allowed to buy the debt. Those restrictions have come into focus recently.

Interest rate increases and economic concerns led the government entity to lower the required amount from $1 million to $250,000.

Average scores remain unchanged but signs of payment stress keep emerging, with Fannie Mae's serious delinquency rate up for the first time since August 2020.

Foreclosure prevention actions overall fell for the sixth time in seven months in October, according to the FHFA.

The latest month's volume was more than $20 billion lower than in March 2020.

The sector is not immune to the same economic instability that affects the single-family residential market, the Mortgage Bankers Association said.

Other investors could step into the breach as depositories depart, and the strain on nonconforming borrowers might not be that bad, recent forecasts suggest.

The consensus calls for shrinking collateralized loan obligation volume in 2023, but rewards are said to outweigh the risks.

Loans with payments late by a year or more were the biggest sub-category within the distressed portfolios a year ago, but now mortgages that've been late for 30-59 days are.

The products are currently limited to a single distribution channel, but the company hasn't ruled out offering them through third-party originators in the future.

Deterioration in credit quality should put strain on collateral originated in late 2021 and early 2022, affecting performance, Barclays Credit Research said.

These types of transactions largely disappeared from the market for years after the Great Recession.

Prime mortgage activity fell notably while nonprime deals and government-sponsored enterprise credit risk transfers increased in 2022, according to Kroll Bond Rating Agency.

However, a tiered pricing system will limit an inflation-driven increase to under 10% for a small group of originators.

Nonbanks will probably see the least change, while securitization lenders, depositories and REITs are likely to experience the most, an Urban Land Institute survey suggests.