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Securities Issuance Stays Strong and Innovations in Multiclass Products Attract New Participants
by Ginnie Mae | 5/26/2020

Ginnie Mae’s investment in operational and program improvement is helping Issuers do business with Ginnie Mae and provide a wider group of investors with the products they demand, strengthening Ginnie Mae’s ability to maintain the flow of affordable mortgage capital to households in the U.S. Ginnie Mae saw record volume in MBS issuance in April, and a new investor type began using a new feature in one of the agency’s multi-class product.

Specifically, more than $63 billion of Ginnie Mae MBS were issued in April, the ninth consecutive month MBS issuance exceeded $50 billion and the second time volume was above $60 billion in a month.

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Single-family mortgage rates consistently near-record-low levels since last summer and the scalability of the Ginnie Mae platform to meet market demand have helped fuel Issuance strength in the MBS business. Program innovation in the multi-class segment, particularly in the Platinum product -- which increases administrative flexibility and liquidity for investors holding small dollar sized Ginnie Mae MBS -- has driven issuance in that product.

Platinum securities volume reached $6.6 billion in April via 30 transactions, up from $4.4 billion and 40 transactions in March. Ginnie Mae’s Office of Capital Markets continues to innovate within its program and work to bring in new types of investors to the Platinum program.

April saw strong issuance of $1.6 billion in the Ginnie Mae Jumbo Only Fixed Platinum option. This option allows Platinum users to bundle Jumbo Fixed pools together and get a pool type assigned reflecting the Jumbo nature of collateral. Having the proper Jumbo pool-type assigned to the security facilitates applying the most accurate prepayment model to the security, enabling better pricing.

April also saw the first HMBS Platinum transactions with adjustable-rate mortgage collateral. Typically, HMBS ARMs are securitized through REMIC transactions, but the new Platinum program innovation now offers another option for investors.

Ginnie Mae REMICS, another multi-class product, also reported strong April volume. Seventeen REMIC transactions were settled in the month for $7.1 billion, compared to 18 deals for $9.8 billion in March.

Overall, the trend in Ginnie Mae securities is positive, illustrating the agency’s strong commitment to meeting the needs of Issuers, investors, and to the ultimate benefit of the homeowners and renters who rely on a steady supply of mortgage capital.

Ginnie in Brief Contributors
Michael R. Bright
Ginnie Mae
Michael Drayne
Gregory A. Keith
Maren Kasper
Tamara Togans
Roy Hormuth
John F. Getchis
John T. Daugherty
Omar Bouaichi
Seth D. Appleton
Eric Blankenstein
Alven Lam
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Last Modified: 6/26/2020 5:00 PM