A Message from Terry Carr, Senior Advisor, Communications & Congressional Relations
“Investing in the American Dream” packs a big punch. As the theme for the Mortgage Bankers Association’s (MBA) 99th Annual Convention and Expo in Chicago last month, this phrase resonated with all of us in attendance. With today’s Presidential election, we are each focused on what “Investing in the American Dream” means to us, personally and professionally. For Ginnie Mae, it means delivering on our mission: to support affordable housing in America by linking global capital markets to the nation’s housing finance market. In doing so, we play a critical role in providing homeownership and housing opportunities for millions of Americans.
As part of a special session to open the conference, industry leaders came together to discuss the importance of the federal government’s role in the mortgage finance industry. Our President, Ted Tozer, joined the CEOs of Fannie Mae and Freddie Mac, as well as representatives from the MBA, the U.S. Housing and Urban Development (HUD) and the Federal Home Loan Banks (FHLBs) to share their thoughts on the state of the industry, top priorities and future initiatives. Housing finance leaders agree that, though challenges remain, we need to be thoughtful in our transition to a system that draws capital back into the industry and includes the appropriate checks and balances, regulation and transparency.
Let me share some of the key themes Mr. Tozer communicated to the attendees during this discussion. Specifically, I’d like to highlight his perspective on the importance of Ginnie Mae’s securitization platform and our primary business objectives as we move into the next fiscal year.
When the credit crisis hit in 2008, Ginnie Mae took on a much larger role in supporting the U.S. housing finance market. Our market share rose from 5.1 percent in 2007 to 23.6 percent by the end of fiscal year (FY) 2012. Ginnie Mae’s unique securitization platform has allowed us to pump nearly $1.7 trillion in liquidity into the U.S. housing mortgage finance market since the crisis began, providing homeownership and housing opportunities for more than 6.3 million households. With a $1.3 trillion portfolio and more than $350 billion in annual issuance, Ginnie Mae’s business model is invaluable to America’s housing system.
As we look to the year ahead, Ginnie Mae remains keenly focused on three primary objectives:
First, we want to continue building and developing an organization that supports the needs of our stakeholders. Though our staff remains very lean, we have increased staffing resources to more effectively serve the market, placing greater focus on our account management and customer service functions. Ginnie Mae remains committed to looking for new ways to identify, attract and partner with a broad domestic and international investor base.
We’ve also put more emphasis on new Issuer orientation, training and education, as well as ongoing training for all Ginnie Mae Issuers. Ginnie Mae has a responsibility to help maintain stability and liquidity while also protecting taxpayers from undue risk. That means providing Issuers of all sizes with the proper tools to be successful. In his speech, Mr. Tozer noted that Ginnie Mae strives to have a diverse Issuer base and shared that the organization is encouraging small lenders to form cooperatives when appropriate, so as to provide better access to Ginnie Mae’s programs.
Our second business objective is enhancing our securitization platform. To do so, we must improve our Information Technology (IT) and data infrastructure, which make up the platform’s backbone. Central to achieving this objective is delivering loan level disclosure by the fourth quarter of 2013, which will increase the transparency of the mortgage loans backing Ginnie Mae securities. It also means upgrading our existing legacy systems, including the modernization of Ginnie Mae’s Integrated Pool Management System (IPMS). These improvements and enhancements are expected to be completed in 2014, leaving Ginnie Mae equipped with a state-of-the-art securitization platform that will more effectively meet the needs of our investors.
Our final objective for the coming year is to continue increasing our risk management practices. We have a number of initiatives underway that are designed to reduce business risk as much as possible. For example, Ginnie Mae has augmented its resources to look more carefully at an Issuer’s ability to mitigate risk through their financial resources and operations. We are also improving our security monitoring by increasing the extent to which we examine security composition and performance.
Overall, the MBA Annual Convention and Expo delivered quality discussion and debate surrounding the future of America’s housing finance system. Ginnie Mae’s active participation in this important annual event reinforces the instrumental role we play in this complex industry. A role we will continue to play well into the future. To Ginnie Mae, “Investing in the American Dream” means delivering liquidity to the U.S. housing system and being a strong supplier of the capital that finances affordable single-family and rental housing. And, that’s exactly what Ginnie Mae remains committed to doing every day.
Senior Advisor, Communications & Congressional Relations