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).


  • Affordable loan credit insurance risk transfer closed

    Sector developments and company hires

    Affordable CIRT closed Fannie Mae has executed a new credit insurance risk transfer (CIRT) transac...

    Market moves    31 July 2019
  • Portuguese boost

    RMBS tightens on call optionality

    Portuguese RMBS outperformed other securitisation asset classes last week, boosted by the surprise c...

    News    31 July 2019
  • QM revisited

    Private mortgage market to fill the void?

    The CFPB’s ANPR in relation to the GSEs’ temporary qualified mortgage provision...

    News Analysis    31 July 2019
  • Winding up order issued for Clifden

    Company hires and sector developments

    Clifden wind up A winding-up order has been issued by the High Court of Justice of the Isle of Man...

    Market moves    29 July 2019
  • Mortgage firm completes residuals sale

    Company hires and sector developments

    Residual sale Charter Mortgages is set to sell its residual economic interest in the Precise Mortg...

    Market moves    26 July 2019
  • Benchmark SRT inked

    Bank of Scotland completes unusual synthetic UK RMBS

    Bank of Scotland has launched its first post-crisis synthetic UK RMBS. Dubbed Syon Securities 2019,...

    News Analysis    25 July 2019
  • Italian renaissance?

    Spike in new issuance supported for now

    The uptick in Italian ABS/MBS primary issuance in the past month or so gives the impression of a lon...

    News Analysis    24 July 2019
  • Esoteric ABS head announced

    Sector developments and company hires

    Esoteric ABS head named MUFG has hired Keith Allman as md and head of esoteric ABS, effective Augu...

    Market moves    23 July 2019
  • ABS head named

    Company hires and sector developments

    Euro ABS head appointed Santander has hired Francesco Dissera as head of continential Europe, secu...

    Market moves    22 July 2019
  • Offshore investment in Chinese ABS soars

    Investors find relative value in second largest ABS market

    Foreign investment in the Chinese ABS market is increasing exponentially, as routes to entr...

    News Analysis    22 July 2019
  • Co-ceo named

    Sector developments and company hires

    Co-ceo named Värde Partners has named Ilfryn Carstairs as co-ceo, alongside co-founder Ge...

    Market moves    19 July 2019
  • Fast track

    ING RMBS turbo kicks in

    Moody's has upgraded three tranches from ING’s Orange Lion 2013-10 RMBS, reflectin...

    News    19 July 2019
  • Additional resources for disclosure published

    Sector developments and company hires

    Agri-investing appointment Arable Capital Partners has appointed Matt Reus a vp in the Bellevue, W...

    Market moves    18 July 2019
  • Bank fined over MBS trading failures

    Company hires and sector developments

    Agency heads announced Morningstar Credit Ratings (MCR) has named Erin Stafford as head of the com...

    Market moves    17 July 2019
  • Fund founder guilty of fraud

    Company hires and sector developments

    African solar plan approved The African Development Bank Group has approved an innovative multinat...

    Market moves    15 July 2019
  • Green investment partnership launched

    Company hires and sector developments

    Green investment Amundi and the EIB have signed a partnership to launch the Green Credit Continuum...

    News    12 July 2019
  • Pros and cons

    STS conversion benefits weighed

    The incentives for converting pre-2019 securitisations into STS-compliant deals differ across seller...

    News Analysis    12 July 2019
  • Novel approach

    UTPs drive ReoCo rethink

    Investors and servicers in the Italian non-performing loan market are targeting a new approach to Re...

    News Analysis    11 July 2019
  • Investment chief appointed

    Sector developments and company hires

    Business Mortgage Finance 6 update Business Mortgage Finance 6, the issuer, has informed noteholde...

    Market moves    10 July 2019
  • New deals surge

    Quarterly SCI data update

    2Q19 saw a surge in new issuance volume across securitisation markets either side of the Atlantic. T...

    News Analysis    10 July 2019
  • Spanish exposure

    Rare NPL RMBS prepped

    Rarely seen Spanish assets are behind the latest non-performing loan RMBS currently marketing. At th...

    News    10 July 2019