News Column

Fitch Virtual Investor Meeting: What Will Reignite U.S. RMBS?

June 24, 2014



NEW YORK--(BUSINESS WIRE)-- Private label U.S. RMBS issuance has been disappointing so far this year, though signs of life are emerging and GSE related issuance has been a bright spot, according to Fitch Ratings in its latest U.S. structured finance virtual investor video series that was launched today.

The RMBS recovery has been very slow and somewhat disappointing, according to Managing Director Rui Pereira. In fact, the majority of the 50 RMBS deals securitized post-crisis came to market last year. However, issuance has picked up in the past few weeks and GSE risk-sharing transactions have become routine, a sign that there is still investor demand for mortgage related products. Investors are also recognizing the extremely strong performance of post-crisis RMBS collateral quality. Greater investor demand could lead to increased incentive for banks to securitize the assets they are currently holding on balance sheet.

One pertinent question investors are posing is whether final QM rules will help. Pereira said the impact so far has been very limited as lenders are still adjusting their underwriting guidelines to conform to the new rules. As to whether non-QM loans will make their way into new deals, Pereira said it is not really a question of when, but rather what type of non-QM loans we will see in new deals. Further, investors are seeking perspective on the securitization of non-traditional mortgage assets including non-performing or re-performing loans and single-family rental receivables which could provide a shot in the arm to the somewhat dormant private label RMBS market.

As part of Fitch's new investor video series, the rating agency's U.S. structured finance group heads discuss hot topics on investors' minds and how Fitch is addressing these topics, be it on specific deals, regulatory issues or even ways to enhance Fitch's research products. The video series will be available on Fitch's 'Multimedia' page at 'www.fitchratings.com'. Questions can be emailed to 'sfinvestor@fitchratings.com'

Additional information is available on the following page: 'http://info.fitchratings.com/VirtualInvestorMeetings/'

Additional information is available at 'www.fitchratings.com'.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.



Fitch Ratings

Rui Pereira, +1 212-908-0766

Head of U.S. RMBS

Fitch Ratings Inc., 33 Whitehall Street, New York, NY, 10004

or

Kevin Duignan, +1 212-908-0630

Global Head of Securitization and Covered Bonds

or

Zanda Lynn, +1 212-908-0601

Managing Director, Business and Relationship Management

or

Media Relations:

Sandro Scenga, +1 212-908-0278

sandro.scenga@fitchratings.com

Source: Fitch Ratings


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