​WASHINGTON, D.C.—On Friday, May 10, 2024, Government National Mortgage Association (Ginnie Mae) Acting President Sam Valverde provided the following statement to the Financial Security Oversight Council (FSOC):

Thank you, Madame Secretary, for the opportunity for Ginnie Mae to join the Council in this important work. Since the 2008 financial crisis, there has been a significant shift in the mortgage market away from traditional depository banks to nonbanks, or independent mortgage banks (IMBs). This shift is particularly pronounced in Government mortgage lending programs and Ginnie Mae's mortgage-backed securities (MBS) program.

While the growth of IMBs in the mortgage market introduced unique challenges, it has also expanded the reach of these programs. IMBs have met borrowers where they are, adopting new technologies and practices to better serve them, and have helped millions of Americans achieve homeownership. Their story of growth has also been the story of Ginnie Mae's growth, and our Issuers have helped advance our mission to expand access to affordable credit and housing to historically underserved communities, including low- to moderate-income borrowers, seniors, veterans, and rural and Tribal communities.

These federal programs were originally designed with depository institutions in mind. Independent mortgage banks lack the diverse funding sources that regulated banks enjoy. Their unique focus on housing finance has driven significant consumer benefits, but it also drives unique liquidity challenges in the housing market precisely when liquidity is most needed—to support loss mitigation and orderly servicing transfers during a downturn.

We at Ginnie Mae have been raising this source of concern for over a decade. We have spent just as long deploying our existing authorities to develop a suite of risk management and oversight tools to manage these risks, but we need new authorities to address these issues in a holistic manner. This is why it is so important that we have a public conversation about these risks.

This report represents months of work and introduces a number of recommendations for how state and federal agencies can strengthen the housing finance system and address these persisting challenges.

We look forward to our continued work with the Council on these pressing matters and stand ready to provide technical assistance on any related legislative approaches. I am confident that, working across the public sector, we can drive meaningful change in a way that supports sustainable access to credit while protecting the financial system and consumers from harm.

Additional information about Ginnie Mae is available at www.ginniemae.gov and on X (formerly Twitter), YouTube, Facebook, and LinkedIn.

About Ginnie Mae​​

Ginnie Mae is a wholly owned government corporation that attracts global capital into the housing finance system to support homeownership for veterans and millions of homeowners throughout the country. Ginnie Mae MBS programs directly support housing finance programs administered by the Federal Housing Administration, the Department of Veterans Affairs, the Department of Housing and Urban Development's Office of Public and Indian Housing and the Department of Agriculture Rural Housing Service. Ginnie Mae is the only MBS to carry the explicit full faith and credit of the U.S. Government.