WASHINGTON, DC – Ginnie Mae announced today that it is changing the Platinum program’s guaranty fee structure and lowering the minimum amount necessary to create a Ginnie Mae Platinum Security. The changes are effective for October 2015 settlements and thereafter.

“The Platinum program is an efficient mechanism for investors to manage their Ginnie Mae securities,” said John Getchis, Ginnie Mae’s senior vice president of capital markets. “We want to encourage utilization of the program by lowering the G-Fee, the minimum amount investors need to create a platinum security, which will increase the administrative, pricing and distribution efficiency of the mortgage-backed securities program.”

Ginnie Mae Platinum Securities allow investors to combine Ginnie Mae MBS pools with uniform mortgage interest rates and original terms to maturity into a single security, backed by the full faith and credit of the United States Government. Investors then receive a single payment from the combined securities every month, rather than separate payments from each individual security. Because it lowers administrative costs and improves liquidity, particularly for small pools, the Ginnie Mae Platinum Security is an attractive product. Ginnie Mae Platinum Securities can be used in structured finance transactions, repurchase transactions and general trading.

These revisions to the Platinum program will reduce the administrative fee associated with creating these securities, allow certificate holders of Ginnie Mae MBS to aggregate smaller pools into larger, more fungible pool sizes, achieve superior TBA pricing, increase the availability of the TBA supply – particularly in the higher MBS coupons – and eliminate the need to pay higher MultiClass REMIC Fees to distribute the smaller MBS holdings.

The changes to the program include:

Ginnie Mae Platinum Guaranty Fee

The fee structure will be modified by increasing the number of pricing tiers and by lowering the Fee by 0.25 - 0.50 Tics across the tiers. The new tier structure is illustrated in the table below:

The minimum Fee will be $5,000, and the maximum Fee will be $156,250.

Non-Cash Fee

The Non-Cash Fee payable by the allocation of a portion of the underlying Ginnie Mae MBS Certificates to the creation of the Ginnie Mae Platinum Principal Only (PO) Bond will be reduced from $5,000 to $1,000.

Minimum Aggregate Remaining Principal Balance

The minimum aggregate remaining principal balance of the underlying Ginnie Mae MBS Certificates will be reduced from $10,005,000 to $5,001,000. The newly issued Ginnie Mae Platinum Certificate will have an original principal balance equal to the aggregate remaining principal balance of the underlying Ginnie Mae MBS Certificates as of the Issuance Date, minus the Non-Cash Fee of $1,000.

About Ginnie Mae

Ginnie Mae is a wholly-owned government corporation within the U.S. Department of Housing and Urban Development (HUD). Ginnie Mae pioneered the MBS, guaranteeing the very first security in 1970 and raises capital from investors in the global credit markets to ensure liquidity for affordable rental and homeownership opportunities across the country. Through its MBS, Ginnie Mae finances housing mortgage insurance programs run by the Federal Housing Administration (FHA), the Department of Veterans Affairs (VA), the Office of Public and Indian Housing (PIH), and the Department of Agriculture’s Rural Housing Service. Ginnie Mae securities carry the full faith and credit of the United States Government.