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


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).

  • Fund targets new structured opportunities

    Semper Capital Management is prepping a new alternative asset strategy to seize new opportunities in...

    Job Swaps    18 May 2016
  • Small-value sales due

    The New York Fed's open market trading desk intends to conduct two small-value agency MBS sales oper...

    News Round-up    18 May 2016
  • SFR expenses weighed

    Actual net cashflow in single-family rental securitisations has been in line with expectations at ne...

    News Round-up    17 May 2016
  • Freddie debuts latest risk transfer offering

    Freddie Mac has a new way to transfer multifamily mortgage credit risk. It has now settled its first...

    News Round-up    17 May 2016
  • Euro secondary slumbers again

    Yesterday saw another sleepy start to the week for the European securitisation secondary market. A...

    SCIWire    17 May 2016
  • FNMA NPLs scooped up

    Goldman Sachs is the latest winning bidder in Fannie Mae's ongoing process of sell...

    News Round-up    16 May 2016
  • SCI Start the Week - 16 May

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

    Pipeline While ABS additions to the pipeline were steady last week, they were joined by a greater v...

    News    16 May 2016
  • Countrywide partial judgement approved

    The severance order and partial final judgement for 512 of the 530 trusts subject to the US$8.5bn Co...

    Job Swaps    16 May 2016
  • Loss criteria updated

    Fitch has updated its criteria for estimating losses on US RMBS mortgage pools, following the releas...

    News Round-up    13 May 2016
  • Excess rent impact analysed

    Single-family rental (SFR) investor loans where the property income exceeds 1.2 times the debt servi...

    News Round-up    12 May 2016
  • Countrywide pay-out nears

    The New York Supreme Court last week received a proposed severance order and partial final judgement...

    Job Swaps    12 May 2016
  • Euro secondary still sluggish

    Activity continues to be sluggish in the European securitisation secondary market despite the tone r...

    SCIWire    12 May 2016
  • SFIG TRID framework 'adequate'

    SFIG's draft proposal to standardise the framework for reviewing and grading loans for TILA-RESPA In...

    News    11 May 2016
  • Deal agent rankings assigned

    Morningstar Credit Ratings has assigned two new vendor rankings for the recently created roles of RM...

    News Round-up    11 May 2016
  • Insurers' structured holdings slip

    Life insurers held more than US$380bn of structured products securities at the end of 2015, which We...

    News    10 May 2016
  • UKAR transfer finalised

    Computershare has been appointed to undertake mortgage servicing for UK Asset Resolution, following...

    Job Swaps    10 May 2016
  • Euro ABS/MBS starts slow

    It was another slow start to the week for the European ABS/MBS secondary market. Yesterday's sessi...

    SCIWire    10 May 2016
  • Firm foundations

    RMBS breaks records, prepares for post-referendum issuance

    The £6.2bn Towd Point Mortgage Funding 2016-Granite1 RMBS that priced last month is the lar...

    News Analysis    10 May 2016
  • SCI Start the Week - 9 May

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

    Pipeline Last week's pipeline additions consisted of eight ABS, two RMBS and a single CMBS. The A...

    News    9 May 2016
  • Mixed energy effects for Euro RMBS

    While both Aberdeen and Groningen are affected by stress from the energy sector, mortgage arrears ha...

    News Round-up    9 May 2016
  • UK prime RMBS 'stable'

    UK prime RMBS continues to perform in a stable fashion, according to Moody's latest index results on...

    News Round-up    6 May 2016