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).


  • SCI Start the Week - 24 April

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

    Pipeline Additions to the pipeline were focused on ABS and RMBS last week, with the former dominati...

    News    24 April 2017
  • Risk transfer round-up - 21 April

    The EIF returned to the risk transfer market this week, with a €90m mezzanine guarantee fo...

    News    21 April 2017
  • Job swaps round-up - 21 April

    North America Morningstar has hired Charles Citro as md for CMBS ratings and analytics, based in N...

    Job Swaps    21 April 2017
  • Clean-up call volume rising

    US non-agency RMBS amounting to more than US$1bn in UPB was called in 1Q17, making it one of the bus...

    News    20 April 2017
  • Euro ABS/MBS picks up

    Activity in the European ABS/MBS secondary market is picking up after the Easter break. Yesterday...

    SCIWire    20 April 2017
  • Ocwen may target MSR purchases again

    Ocwen Loan Servicing has reached a settlement with the New York Department of Financial Services (NY...

    News    19 April 2017
  • Debut Canadian RMBS prepped

    The first RMBS sponsored by a major Canadian bank is marketing. Dubbed Bicentennial Trust 2017-1, th...

    News    18 April 2017
  • Floating-rate ABS lacks support for growth

    Lack of demand will likely limit the growth of floating-rate ABS and CMBS in the US, despite rising...

    News Analysis    13 April 2017
  • Euro secondary ebbs and flows

    Activity in the European securitisation secondary market continues to ebb and flow. Trading patter...

    SCIWire    11 April 2017
  • SCI Start the Week - 10 April

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

    Pipeline ABS names once again made up the majority of last week's pipeline additions. There were al...

    News    10 April 2017
  • Today's RMBS opportunity deconstructed

    US RMBS continue to rally, supported by robust labour and housing markets, cheap credit and increasi...

    Talking Point    10 April 2017
  • Job swaps round-up - 7 April

    North America KeyBanc Capital Markets has hired Chris O'Neill and Jeffrey Tucker to its securitise...

    Job Swaps    7 April 2017
  • Irish NPL RMBS 'could start wave'

    Lone Star is back in the market with another Irish RMBS. It is currently marketing European Resident...

    News    6 April 2017
  • Deephaven debuts non-conforming deal

    Deephaven Mortgage is in the market with an RMBS backed primarily by non-QM loans extended to non-co...

    News    6 April 2017
  • Euro ABS/MBS active

    The European ABS/MBS secondary market is once again active without yet fully taking off. "Secondar...

    SCIWire    6 April 2017
  • Largest STACR to date prices

    Freddie Mac has priced its largest STACR deal to date. The US$1.32bn STACR 2017-DNA2 is also Freddie...

    News    5 April 2017
  • B&B portfolio sale to bring new RMBS

    UK Asset Resolution (UKAR) has sold two asset portfolios comprising performing buy-to-let loans tota...

    News    4 April 2017
  • Euro secondary restarts

    The turn of the quarter has restarted activity in the European securitisation secondary market. Fl...

    SCIWire    4 April 2017
  • SCI Start the Week - 3 April

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

    Pipeline The pipeline comprised a mixed bag of issuers last week. ABS deals once again dominated th...

    News    3 April 2017
  • Job swaps round-up - 31 March

    EMEA EJF Capital is to float its closed-ended investment fund on the London Stock Exchange. Dubbed...

    Job Swaps    31 March 2017
  • Value seen in jumbo 2.0 and RPL deals

    US non-agency issuance volumes are inching up on the back of the housing market recovery. Re-perform...

    News Analysis    31 March 2017