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 - 13 May

    A review of securitisation activity over the past seven days

    Transaction of the week Last week saw an unusual Irish CMBS hit the European pipeline, from debut...

    News    13 May 2019
  • STS 'not enough' for European ABS revival

    Securitisation 'needs to be used more' as funding tool

    At the start of last year, BNP Paribas Asset Management hired Michel Fryszman as its new he...

    News Analysis    3 May 2019
  • Rating agency appoints new SF head

    Company hires and sector developments

    Bank bulks up Macquarie has appointed Carolyn Porretta md, structured finance and real estate, bas...

    Market moves    3 May 2019
  • First SOFR-indexed MBS tranche inked

    Sector developments and company hires

    Claims predictability to improve? The Florida legislature last month passed a bill to reform the re...

    Market moves    2 May 2019
  • SFR issuer prepays class F notes

    Sector developments and company hires

    EMEA Alantra has reinforced its portfolio advisory capabilities with the addition of six senior p...

    Market moves    30 April 2019
  • Rating agency names managing director

    Sector developments and company hires

    EMEA Scope has named Guillaume Jolivet as md. He joins the firm’s management board, along...

    Market moves    25 April 2019
  • Lender charged for overstating returns

    Sector developments and company hires

    CRT analytics dv01 has launched a credit risk transfer market surveillance offering, which adds U...

    Market moves    23 April 2019
  • CLO manager denied incentive fee

    Sector developments and company hires

    Incentive fee ruling The High Court in London has ruled that Barings (UK), as collateral manager, w...

    Market moves    18 April 2019
  • BMF administration order filed

    Sector developments and company hires

    BMF 6 tender An application for an administration order in respect of Business Mortgage Finance 6 w...

    Market moves    16 April 2019
  • Sonia success

    European ABS market update

    The first UK STS RMBS – Nationwide’s Silverstone Master Issuer 2019-1 &ndash...

    Market Reports    16 April 2019
  • Inaugural non-QM RMBS prepped

    Deal marks new phase for global investor

    The first seasoned, non-qualified mortgage RMBS issued by a private fund managed by PIMCO is marketi...

    News    12 April 2019
  • BWIC boom

    Quarterly SCI data update

    The first quarter of a year is usually quieter than the previous quarter and, for the most part, 1Q1...

    News Analysis    11 April 2019
  • Affordability test

    'Mortgage prisoner' refi proposal unveiled

    Around 60 legacy UK RMBS with a face value of £29bn could be positively affected by the UK...

    News Analysis    2 April 2019
  • Positive sentiment?

    European ABS market update

    European ABS primary issuance is gaining momentum, as the second quarter begins. Indeed, the variety...

    Market Reports    2 April 2019
  • CEO appointed

    Sector developments and company hires

    CEO appointed Curtis Arledge has joined Mariner Investment Group as chairman and ceo. In addition...

    Market moves    28 March 2019
  • 'Constant demand'

    UK firms hiring across range of SF roles

    Hiring in the UK structured finance space has been buoyant in the last 12 months, with recruitment a...

    News Analysis    28 March 2019
  • Picking up pace

    European ABS market update

    European ABS secondary market activity has been relatively subdued so far this week. However, the pr...

    Market Reports    28 March 2019
  • STS firm announces debut deal

    Transaction marks second deal to receive STS label

    Prime Collateralised Securities (PCS) has announced its inaugural transaction to be verified as STS-...

    News    26 March 2019
  • Opening the box

    Non-QM sector continues to evolve

    The non-qualified mortgage RMBS sector has expanded faster than the other US RMBS sectors over the l...

    News Analysis    26 March 2019
  • Granite refinancing

    Sector developments and company hires

    Europe Muzinich & Co has hired Laurence Kubli as structured credit specialist with immedia...

    Market moves    25 March 2019
  • Purchase option to be exercised

    Sector developments and company hires

    EMEA Capzanine has appointed Renaud Tourmente as head of business development, effective from 6 M...

    Market moves    22 March 2019