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Stakeholder Letters

Ginnie Mae Surpasses $1.5 Trillion in MBS Issuance, Poised for Continued Growth
Published Date: 7/15/2014 1:00 AM

In May our mortgage-backed securities (MBS) portfolio reached $1.5 trillion, a true milestone for us at Ginnie Mae that demonstrates unprecedented expansion.

In less than four years, our MBS portfolio increased by 50 percent, up from $1 trillion in 2010. By comparison, it took 42 years for Ginnie Mae to reach the $1 trillion issuance mark. This is further evidence that Ginnie Mae is successfully implementing its countercyclical role in the secondary market, providing liquidity when needed and playing an increasing role in stabilizing the housing finance industry, which is crucial to the housing recovery as well as the broader economic recovery.

It is important to note this extraordinary growth came at a difficult time, during the housing crisis, and when the overall economy was faltering. When needed, Ginnie Mae provided a safe, effective, government-backed channel for the flow of capital for U.S. mortgages, significantly limiting risks to the taxpayer and providing critical capital for the housing finance system.

Our exceptional performance is simply a reflection of our continued growth and improvement as a corporation overall. We continue to focus on strengthening our business, as we work to modernize and improve our foundation to provide continued stability to the housing finance system. Additionally, we are upgrading our technology and data infrastructure to enhance our securitization platform. We have also launched important program initiatives and enhanced our ability to meet the needs of the secondary market.

And, as always, our commitment to financial discipline will remain strong.

The rapid growth of Ginnie Mae’s portfolio is indicative of the corporation’s consistent financial stability, generating a profit for the U.S. Government for more than 20 consecutive years, and the effectiveness of Ginnie Mae’s unique business model. Ginnie Mae does not originate mortgage loans, nor does it buy or sell securities or loans for investment purposes. The corporation guarantees investors the timely payment of principal and interest on securities backed by loans insured or guaranteed by other Federal Government housing agencies. Ginnie Mae stands in the fourth loss position behind three layers of risk absorption, including borrowers’ equity, Federal Government loan-level mortgage guarantee programs, and the corporate resources of the lender that issues the mortgage-backed security (MBS). This simple, but effective, business model has served Ginnie Mae well for more than 46 years.

The size of our portfolio, coupled with our consistently strong market share, now more than 30 percent, demonstrates the unique value the housing finance system places in Ginnie Mae.