Welcome to the Ginnie Mae Web Site

Supporting the Expansion of Affordable Housing in America

Message from the President

Now is a crucial point in the history of Ginnie Mae, and I look forward to leading Ginnie Mae in its increasingly important role in the current housing finance system.

Never before has the need for Ginnie Mae been more apparent. As a result of the credit collapse, Ginnie Mae's mortgage-backed securities (MBS) issuance has risen from approximately $6-7 billion per month in 2006 to more than $30 billion a month currently. At one point, Ginnie Mae's share of the MBS market reached nearly 35 percent . Since the peak of the credit crisis in September 2008, Ginnie Mae's portfolio has grown approximately more than 50 percent. Our outstanding portfolio could reach a trillion dollars before the end of the year. If it weren't for investors' willingness to buy Ginnie Mae securities during the crisis, our nation's housing economy would have suffered far more. Indeed, the nation has relied heavily on Ginnie Mae.

For more than 40 years, Ginnie Mae has provided liquidity in times of crisis and ensured a stable secondary market for government insured loans. The reliance on Ginnie Mae during the current crisis only highlights this role. Ginnie Mae has provided an extraordinary level of support to our capital markets without requesting economic assistance from Treasury.

Ginnie Mae is well positioned to continue providing this support. It has accumulated substantial reserves over the years and throughout the crisis has remained profitable. Last year, this wholly-owned government corporation earned half a billion dollars; the previous year, it earned nearly a billion dollars. That is no small accomplishment given the economy and poor performance of other corporations in the MBS market. I truly believe that there is no government or industry MBS market player safer and more secure than Ginnie Mae.

In part, Ginnie Mae remains financially strong because it takes a conservative approach to the management of its MBS program. The foundation of the Ginnie Mae business is the simple pass-through security. Ginnie Mae does not hold mortgage-backed securities or whole loan portfolios for investment purposes. Therefore, it is not subject to the mark-to-market losses often associated with these assets nor does it need sophisticated derivatives to hedge interest rate risk. Additionally, the collateral underlying its securities is government-insured. I believe avoiding undue risk has served Ginnie Mae well.

It is easier to effectively manage risk when it is clear who you serve. Thus, at Ginnie Mae, we are aided by the fact that, as a wholly-owned government corporation, we do not have the fundamental conflict between executing the nation's housing policy and earning a return for private shareholders. Ultimately, the taxpayers are our shareholders. This allows Ginnie Mae to act as an excellent steward of the U.S. government's full faith and credit guaranty.

Being good steward of taxpayer interests is not our only priority; we are also committed to keeping housing affordable. The Ginnie Mae MBS is a primary way of doing so because it ensures that a 30-year fixed-rate mortgage is available regardless of the economic environment. Prior to Ginnie Mae inventing MBS 40 years ago, local areas experienced regional credit crunches. Since that time, our nation's capital markets have been transformed by the ease with which capital now flows into local housing markets through the mortgage-backed security.

We are proud of creating the MBS, and our role in maintaining a stable housing finance system. We intend to further solidify our already strong foundation in the secondary market by comprehensively evaluating all of our current programs and relationships with investors and issuers. At Ginnie Mae, we stand ready to help lead the country out of its housing problems and intend to serve you well in the coming years... I am very much looking forward to leading our mission.