Economy

The 2008 package proved some banks were too big to fail. But the rushed $2.2 billion stimulus shows now any company can be bailed out.

Mortgage bankers are sounding alarms that the Federal Reserve's emergency purchases of bonds tied to home loans are unintentionally putting their industry at risk by triggering a flood of margin calls on hedges lenders have entered into to protect themselves from losses.

The impending wave of loan delinquencies because of the coronavirus hurt private mortgage insurer earnings, but the companies will still have sufficient capital, a Keefe, Bruyette & Woods report said.

Draw-downs on C&I credit more than quadrupled in a seven-day period ended March 25. Lenders may try to rein them in if the crisis drags out, but legal precedent isn’t on their side.

The Federal Housing Finance Agency authorized the government-sponsored enterprises to lend additional support to the mortgage-backed securities market and temporarily allow some flexibility in lending requirements to address coronavirus-related concerns.

While the mortgage market began the year healthy, lenders and borrowers need to prepare for the impacts of the coming coronavirus recession.

Refinancing activity is surging, existing borrowers are inquiring about loan modifications, loan closings are being delayed by more complex credit checks — and banks are short on people to handle it all.

Mark Calabria said Fannie Mae and Freddie Mac are currently equipped to handle elevated delinquencies, but they might need congressional or Federal Reserve help if fallout from the coronavirus persists.

In signing off on deposit insurance for the payments giant and student loan servicer, the FDIC sanctioned the first new industrial loan companies in over a decade.

Add continued growth in commercial and multifamily mortgage debt outstanding to the list of things that the economic fallout from the coronavirus might affect.

KKR is tapping the commercial mortgage securities market to finance a new loan secured by a portfolio of 71 industrial “last-mile” logistics properties owned by the investment firm in seven states.

If banks are unable to weather the economic fallout from the outbreak, calls for more dramatic reforms could get louder.

Increased refinancing volume led Fannie Mae to raise its 2020 estimate by $300 billion and 2021 projection by $280 billion.

GreatAmerica Financial in Iowa is looking to form a bank so it can offer more products to small and midsize companies.

Banks may be protected from a direct hit, but they have invested in vehicles that include such loans, potentially exposing them to defaults.

Fannie Mae and Freddie Mac coming out of conservatorship and transitioning into public utilities would be the ideal for small mortgage lenders, according to trade-organization representative Robert Zimmer.

Mortgage companies that borrow heavily to keep their operations running may face financial pressure from coronavirus-related market volatility as it affects the valuations of collateral securing their financing.

Fannie Mae completed its first two Credit Insurance Risk Transfer transactions of 2020, shifting $1 billion of single-family loan credit risk to insurers and reinsurers.

Even with the global-trade wars’ ongoing financial pressure on the U.S. agricultural industry, John Deere Capital Corp. has yet to see serious signs of distress from borrowers who’ve financed farm equipment through the Deere & Co. lending unit.

An effort by the Federal Housing Finance Agency to examine membership rules for the Federal Home Loan Bank System is reigniting an argument over whether to allow more nonbanks in or impose tougher barriers.