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).


  • 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
  • Greencoat Investments notice received

    Sector developments and company hires

    BUMF 6 application discontinued A notice of discontinuance from Greencoat Investments has been rec...

    Market moves    5 July 2019
  • EBRD appoints Greece, Cyprus lead

    Company hires and sector developments

    EBRD hires NPL vet The EBRD has appointed Andreea Moraru to lead its operations in Greece and Cypr...

    Market moves    4 July 2019
  • Pre-summer rush

    European ABS market update

    Activity levels are currently high across the European ABS/MBS and CLO markets and that looks set to...

    Market Reports    3 July 2019
  • CLO firm boosts research team

    Company hires and sector developments

    CEDE made public AIR Worldwide has published its Catastrophe Exposure Data Exchange (CEDE) databas...

    Market moves    2 July 2019
  • ReoCo impact assessed

    Company hires and sector developments

    CMIP acquisition Investcorp Credit Management US has entered into a definitive interest purchase a...

    Market moves    28 June 2019
  • Increasing diversity

    Competition, TFS exit driving UK RMBS volume

    The UK mortgage market is furiously price competitive, with ring-fenced high street banks crowding o...

    News Analysis    28 June 2019
  • Compliance challenges

    STS requirements raise regulatory liability concerns

    The securitisation market now appears to be embracing the new Securitisation Regulation and adapting...

    News Analysis    28 June 2019
  • GSE reform study released

    Sector developments and company hires

    Private credit double announced Solar Capital Partners has hired two senior private credit investm...

    Market moves    27 June 2019
  • CMBS auditing upset

    Sector developments and company hires

    Auditing issue The JUNO (ECLIPSE 2007-2) CMBS failed to file its financial statements for 2017, to...

    Market moves    26 June 2019
  • Forward-mortgage first prepped

    Global investor markets 'unique' RMBS

    Blackstone is marketing an inaugural, US$264.5m forward-mortgage RMBS featuring unique collateral ch...

    News    26 June 2019
  • Chinese law firm nabs SF expert

    Sector developments and company hires

    China Han Kun has hired Li Huhuan as partner to the firm’s Shanghai office. Huhuan focus...

    Market moves    21 June 2019
  • Irish exit

    Re-performing loan RMBS marketing

    An Irish re-performing loan RMBS has hit the market. The €336.56m Shamrock Residential 2019...

    News    20 June 2019
  • Securitised products head retires

    Sector developments and company hires

    Bank SPG head retires Lloyds Bank is making several changes to leadership positi...

    Market moves    19 June 2019
  • Ratings slip-up leads to downgrade

    Company hires and sector developments

    Acquisitions PERILS has acquired Toronto-based Catastrophe Indices & Quantification (CatIQ...

    Market moves    18 June 2019
  • Risk firm in international ILS hiring spree

    Sector developments and company hires

    BD appointed IHS Markit has appointed Sandrine Markham director, business development for Debtdoma...

    Market moves    17 June 2019
  • 2018 best post-crisis year for Australia

    RMBS dominates but unsecured ABS growing

    2018 was the best year for Australian securitisation activity since the financial crisis and while i...

    News    14 June 2019
  • Law firm expands SF expertise

    Company hires and sector developments

    Clean energy firm names cfo Renew Financial has named Mary Kathryn Lynch cfo, having previously se...

    Market moves    14 June 2019
  • Releasing potential?

    Equity release mortgages generating interest

    Expectations for the return of meaningful equity release mortgage (ERM) securitisation volumes remai...

    News Analysis    13 June 2019
  • Slow but steady

    Sentiment around STS warms, although issuance forecasts remain muted, say Global ABS panellists.

    Extention of the STS regime to more asset classes would benefit the European ABS market, according t...

    News    12 June 2019
  • CLO firm boosts originations expertise

    Company hires and sector developments

    CLO firm boosts originations team Monroe Capital has expanded its direct originations team with th...

    Market moves    12 June 2019