Structured Credit Investor SCI’s 5th Annual Capital Relief Trades Seminar 17 October 2019, London
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RMBS

Residential mortgage-backed securities, or RMBS, are bonds or notes created by securitisation that are backed by residential mortgages or residential real estate loans. RMBS originators are typically financial institutions that originate residential real estate or residential mortgage loans, including banks, building societies/savings & loans and mortgage finance companies. However, issuers could also include government-guaranteed securities issued following bank bailouts, such as TARP or TALF, and the Government Sponsored Enterprises Fannie Mae and Freddie Mac. To create residential mortgage-backed securities, or RMBS, institutions sell pools of their loans to a special-purpose vehicle, or SPV, which then sells the loans to a trust. The trust then repackages the loans as interest-bearing securities and issues them. This true sale of the loans to the SPV ensures that the RMBS is treated as bankruptcy-remote from the originator. Many different types of assets back RMBS, including prime, non-conforming, sub-prime, Alt-A (or Alternative-A), buy-to-let and single-family rental (SFR) mortgages. The financial crisis caused residential mortgage valuations to plummet, leading to severe losses/defaults in many RMBS transactions (and ABS CDOs), as well as efforts to begin modifying loan documentation and indeed the creation of many credit/dislocation/distressed opportunity/recovery funds to take advantage of opportunities in the RMBS sector. Post-crisis, the Government Sponsored Enterprises Fannie Mae and Freddie Mac have developed a credit risk transfer market, comprising synthetic RMBS structures (whereby the risk is transferred via CDS tranches).


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    The spring 2018 edition of the Brookings Papers on Economic Activity includes a report exploring how...

    News    12 March 2018
  • SCI Start the Week - 12 March

    A look at the major activity in structured finance over the past seven days.

    Upcoming event SCI Risk Transfer & Synthetics Seminar – Tomorrow (13 March), New...

    News    12 March 2018
  • Market moves - 9 March

    North America Anthony Orso has joined NKF Capital Markets as president of capital markets stra...

    Market moves    9 March 2018
  • Innovative RMBS pair prepped

    Two innovative US RMBS transactions are marketing from both sides of the agency/non-agency divide. A...

    News    7 March 2018
  • SCI Start the Week - 5 March

    A look at the major activity in structured finance over the past seven days.

    Upcoming event SCI Risk Transfer & Synthetics Seminar - 13 March, New York SCI...

    News    5 March 2018
  • Landmark sukuk could be first of many

    The inaugural UK sharia-compliant RMBS recently closed, marking the start of a new asset class in th...

    News Analysis    2 March 2018
  • Market moves - 2 March

    North America Cowen and Company has named Philip Cushman as head of global institutional sales whi...

    Market moves    2 March 2018
  • Synthetic exposure expanded

    Bank of Ireland has released its Pillar Three report, which indicates an expansion of its synthetic...

    News    2 March 2018
  • Euro secondary slows

    January's optimism has faded throughout February as activity across the European securitisation seco...

    SCIWire    1 March 2018
  • Stop advance application diverging

    The incorporation of 'stop-advance' provisions in US RMBS 2.0 deals appears to be becoming more prev...

    News    28 February 2018
  • LCR amendments could be STS 'game-changer'

    The European Commission's recent draft regulation on the LCR does not ensure STS securitisations are...

    News    28 February 2018
  • NPL platform incentives weighed

    As part of efforts to facilitate a non-performing loan secondary market, the European Commission is...

    News Analysis    26 February 2018
  • SCI Start the Week - 26 February

    A look at the major activity in structured finance over the past seven days

    Upcoming event SCI Risk Transfer & Synthetics Seminar - 13 March, New YorkSCI's Synthetic Sec...

    News    26 February 2018
  • Market moves - 23 February

    North America David Sykes has rejoined Chapman and Cutler as a partner, expanding the firm's San F...

    Market moves    23 February 2018
  • Busy start for UK RMBS

    UK RMBS has come flying out of the blocks in 2018, with the end of the Term Funding Scheme (TFS) and...

    News Analysis    21 February 2018
  • SCI Start the Week - 19 February

    A look at the major activity in structured finance over the past seven days.

    Upcoming event SCI Risk Transfer & Synthetics Seminar - 13 March, New York SCI...

    News    19 February 2018
  • Market moves - 16 February

    EMEA Fulcrum Asset Management has recruited Mark Horne as a director within the newly created Fulc...

    Market moves    16 February 2018
  • Longer WAL RMBS preplaced

    Obvion has preplaced a static RMBS that does not feature a time call option. Dubbed FORDless Storm 2...

    News    16 February 2018
  • 'Test case' mortgage deal disclosed

    Permanent TSB unveiled this week its Project Glas portfolio of distressed mortgages, as the Irish le...

    News Analysis    16 February 2018
  • French ABS to benefit from new regime

    The creation of a new SPV regime in France (SCI 11 October 2017) will boost the country's ABS sector...

    News Analysis    14 February 2018
  • SCI Start the Week - 12 February

    A look at the major activity in structured finance over the past seven days.

    Pipeline It was yet another busy week of pipeline additions. There were nine ABS, 11 CLOs, three CM...

    News    12 February 2018