Deals backed by seasoned loans still accounted for over half of last year’s non-agency MBS issuance, but securitization of newly originated prime and expanded-credit mortgages more than doubled in 2019.
Total new issuance of securities backed by home loans, commercial mortgages and non-mortgage assets jumped 24% from 2018’s levels to $2.14 trillion last year, the biggest volume since 2007. (Includes three data charts.)
The FHFA has been pushing Fannie and Freddie to reduce the risk profile of the loans they acquire, and that effort appears to be taking hold as the share of high-risk new business fell drastically in the fourth quarter. (Includes two data charts.)
Vehicle-finance transactions and ABS backed by a variety of business-finance assets were the mainstays in 2019’s modest increase in new issuance. Consumer-finance deals saw significant growth but accounted for just 6% of the market. (Includes two data charts.)