Credit risk transfers

Following its deadline for written comments on the topic last month, the Federal Housing Finance Agency is scheduling events that will focus on two key themes emerging in responses.

Arch's second CRT transaction this year to obtain indemnity reinsurance for mortgage-insurance premiums comes at a time it is also experiencing rising 60-plus-day delinquencies on its outstanding securitized pools.

There were questions about the GSEs' use of structured credit risk transfers in the single-family market given an earlier pandemic-related market disruption.

A bond market once thought to be key to the futures of Fannie Mae and Freddie Mac — and the roughly $5 trillion of home loans they backstop — could instead find itself on the scrap heap due to their own regulator.

The FHFA looks to shed light on the amount of funds Fannie and Freddie will need to hold for their risk-sharing deals.

While Freddie Mac stabilized liquidity in mortgage markets, coronavirus-related credit losses drove the GSE's income down in the first quarter of 2020.

Freddie Mac saw a decline in net profit in 2019 due to decreased interest rate income, lower amortization revenue and risk-reducing investment costs, but its consecutive-quarter results improved.

Eagle Re 2020-1 is backed by the performance of a reference pool of 156,065 loans with an outstanding balance of $40 billion.

Fannie Mae is sponsoring a $1.03B CRT transaction, while Caliber Homes Loans, New Residential and Onslow Bay fill the non-QM pipeline

The FHFA’s attempt to move some of its balance sheet into the private sector could leave investors with greater liabilities than they were initially told.