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).


  • Dutch ABS, RMBS notes upgraded

    Moody's has upgraded its ratings on two RMBS and two ABS transactions backed by loans originated by...

    News Round-up    24 May 2016
  • Mortgage servicer shuffles staff

    Following its acquisitions of Homeloan Management (HML) in November 2014 and UKAR's mortgage servici...

    Job Swaps    24 May 2016
  • Due diligence firm promotes pair

    Clayton Euro Risk has promoted two directors to its board. Michael Chadwick and David Avent both tak...

    Job Swaps    24 May 2016
  • Debut green RMBS prepped

    Obvion is in the market with what is believed to be the first-ever green RMBS. Dubbed Green Storm 20...

    News Round-up    24 May 2016
  • Euro secondary patchy

    Activity in the European securitisation secondary market remains very patchy. Despite a positive e...

    SCIWire    24 May 2016
  • SCI Start the Week - 23 May

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

    Pipeline ABS additions to the pipeline carried on last week at a good pace, as 11 such deals joined...

    News    23 May 2016
  • Risk retention class debuts

    Colony Starwood Homes is in the market with its first single-family rental securitisation –...

    News    20 May 2016
  • Countrywide pay-outs 'positive'

    A New York Supreme Court decision last week ordering trustee BNY Mellon to make US$7.9bn worth in ca...

    News Round-up    19 May 2016
  • Upgrades boost Spanish RMBS

    The Spanish RMBS sector continues its recovery, with Moody's last week upgrading 200 classes of Span...

    News    19 May 2016
  • Euro secondary strong but slow

    Sentiment remains strong across the bulk of the European securitisation secondary market but away fr...

    SCIWire    19 May 2016
  • MBS trading, sales teams boosted

    KeyBanc Capital Markets has expanded it fixed income sales and trading platform with the appointment...

    Job Swaps    18 May 2016
  • ITB RMBS resilient

    Investment Trade Bank's (ITB) fall into temporary administration has not had a substantial effect on...

    News Round-up    18 May 2016
  • SFIG adds advocacy leader

    SFIG has named Thomas McCrocklin as director of advocacy. He will report directly to executive direc...

    Job Swaps    18 May 2016
  • 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