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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).


  • Euro secondary split

    Activity and price direction in the European securitisation secondary market is currently split in t...

    SCIWire    16 December 2015
  • Market supports benchmark change

    A majority of US ABS and CMBS market participants would support switching the pricing benchmark from...

    News    15 December 2015
  • Ranieri recruits RMBS pro

    Ranieri Strategies has added two new partners, including Eric Kaplan to focus on structured finance....

    Job Swaps    15 December 2015
  • Euro secondary hangs on

    European securitisation secondary spreads are mostly hanging on despite increasing broader market vo...

    SCIWire    15 December 2015
  • LatAm outlook 'mixed'

    Fitch's outlook for Latin American structured finance in 2016 is mixed across sectors. Stable and po...

    News Round-up    14 December 2015
  • SCI Start the Week - 14 December

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

    Pipeline The pace of pipeline additions slowed last week. The final count consisted of two ABS, an...

    News    14 December 2015
  • SF practice strengthened

    DLA Piper continues to build its financial markets practice with the appointments of Vincent Keaveny...

    Job Swaps    14 December 2015
  • CMHC limits upped

    Canada Mortgage and Housing Corporation (CMHC) has announced a change to the guarantee fees it charg...

    News Round-up    14 December 2015
  • Euro secondary stays slow

    It was, as anticipated, another quiet day in the European securitisation secondary market on Friday...

    SCIWire    14 December 2015
  • Positive outlook for Canadian securitisations

    Moody's expects Canadian ABS and RMBS to continue performing well in 2016. The agency notes that ass...

    News Round-up    11 December 2015
  • NCUA settlement signed

    The NCUA has announced a US$225m settlement with Morgan Stanley to resolve claims arising from losse...

    Job Swaps    11 December 2015
  • Amherst leadership bolstered

    Amherst Pierpont Securities has expanded its senior leadership team with the addition of&am...

    Job Swaps    11 December 2015
  • Euro secondary slowdown

    The end of year slowdown in the European securitisation secondary market looks to be increasing. F...

    SCIWire    11 December 2015
  • BlackBox data, analytics acquired

    Moody's Corporation has acquired the RMBS data and analytics assets of BlackBox Logic. The loan-leve...

    Job Swaps    10 December 2015
  • Japanese credit outlook 'strong'

    The credit quality and performance of Japanese ABS, RMBS and CMBS should remain strong in 2016, says...

    News Round-up    10 December 2015
  • US outlook stable with caveats

    The outlook for US structured finance is stable to positive overall next year, says Fitch. However,...

    News Round-up    10 December 2015
  • Euro secondary mixed

    It's turning into a typically quiet December across most of the European securitisation secondary ma...

    SCIWire    10 December 2015
  • TRID violations prompt concern

    US mortgage lenders could face a tough time complying with the US CFPB's recently...

    News Round-up    10 December 2015
  • Latest SPO sale completed

    Freddie Mac has sold via auction 5,311 deeply delinquent non-performing loans (NPLs) serviced by Wel...

    News Round-up    9 December 2015
  • ABS, RMBS improvements expected

    Improving credit quality in 2016 will benefit European RMBS and ABS, says Moody's. However, a divide...

    News Round-up    9 December 2015
  • Euro ABS/MBS stable

    The European ABS/MBS secondary market remains stable amid wider market volatility. "Overall our ma...

    SCIWire    9 December 2015