MReport July 2018

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62 | TH E M R EP O RT THE LATEST O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T SECONDARY MARKET Ginnie Announces MBS Issuance The GSE experienced a $4B month-over-month increase. T he total outstanding balance for Mortgage Backed Securities (MBS) at Ginnie Mae approached the 2 trillion-mark increasing to $1.9 trillion in April according to the latest report on MBS issuance by Ginnie Mae. On a month-over-month basis, the total issuance of MBS increased to $34 billion in April from $30 billion in March. This included $32.4 billion of Ginnie Mae II MBS and $1.6 billion of Ginnie Mae I MBS, Ginnie Mae says. However, this was a slight decline from $37 billion recorded during the same period last year. Of the $1.6 billion MBS I securi - ties, loans for multifamily housing remained unchanged at $1.4 billion of loans were for multifamily hous- ing. However, loans for single-family homes declined from $239 million in March to $185 million in April. The report indicated that on a year-over-year basis, the total outstanding principal increased from $1.8 trillion in April 2017 to $1.9 trillion during the same period this year. On a quarterly basis, the report indicated that the issuance activity of MBS at Ginnie Mae stood at $117 billion in the first quarter of 2018, a decline from $147 billion recorded in the first quarter of 2017. The total issuance of MBS so far this year stood at $134 billion compared to $473 billion recorded for the whole of 2017, the report says. While Ginnie Mae I MBS are modified pass-through MBS on which registered holders receive separate principal and interest pay - ments on each of their certificates, Ginnie Mae II MBS are securities for which registered holders receive an aggregate principal and interest payment from a central paying agent. Ginnie Mae I securities can include single family, multifamily, manufactured homes, and project construction loans. Why is Hensarling Calling for Action Against Fannie? Hensarling announces a House Financial Services Committee investigation into the GSE. R ep. Jeb Hensarling, Chairman of the House Financial Services Com- mittee, announced that the committee would be launch- ing a full investigation into recent allegations in a Bloomberg report that high-ranking Fannie Mae employees were intention - ally violating their government prohibition on lobbying. Hensarling says if the media report was accurate, this viola - tion was "more than an outrage, it is a direct affront on taxpayers and the current structure of the federally backed conservatorship that has allowed Fannie Mae to operate for the last decade." Fannie Mae received a bailout of more than $120 billion during the financial crisis. "As a condi - tion of receiving those funds, Fannie Mae was explicitly prohib- ited from engaging in 'all political activities—including all lobbying,' a prohibition, which it is now being reported Fannie has deliberately violated," Hensarling said. However, Fannie Mae has denied these allegations. "Fannie Mae does not lobby and has not advocated for any specific policy outcomes on housing finance re - form," Pete Bakel, a spokesperson for Fannie Mae, told MReport. Calling on the Congress to truly solve the problem of "the broken GSE hybrid finance mod - el," Hensarling said. "Congress must enact sustainable housing finance reform as soon as possible and once and for all get rid of any backdoor attempts to resurrect the old, failed ways of the past." These allegations stem from a recent report that quoted unnamed sources saying that some of Fannie Mae's executives were secretly lob - bying among housing finance stake- holders that the best outcome for the GSEs would be to get released from government control, and that they wanted it done without the involvement of the Congress. "As part of our normal course of business, we analyze policy proposals and existing law," Bakel said. "We answer questions from customers, industry groups, and similar stakeholders and provide information about potential implica - tions of the proposals on the mar- ket. It is up to Congress, not Fannie Mae, to determine the future of housing finance reform legislation." "Congress must enact sustainable housing finance reform as soon as possible and once and for all get rid of any backdoor attempts to resurrect the old, failed ways of the past." —Rep. Jeb Hensarling, Chairman of the House Financial Services Committee

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