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NEW YORK, March 31 U.S. mortgage-backed
securities issuance jumped in the first quarter from a year ago
as credit markets loosened up, but investors' appetite for risk
remained limited amid fears over the housing market, a keenly
watched survey showed on Wednesday.
Thomson Reuters said U.S. mortgage-backed securities
issuance totaled $118.4 billion in the first quarter of 2010,
up sharply from $33.5 billion in the same period a year
earlier, a rise of 71.7 percent.
The majority of all U.S. MBS, at 98.5 percent, were backed
by government-sponsored enterprises Fannie Mae, Freddie Mac and
Ginnie Mae during the first quarter of 2010, said Matthew
Toole, an analyst in the deals group at Thomson Reuters.
Nevertheless, the surge in issuance was a strong sign.
The first quarter of 2010 was the best quarter for mortgage
backed securitizations since the third quarter of 2007, he
"Overall, MBS issuance has nearly tripled from the first
quarter of 2009 when volume totaled just $33.5 billion," he
Issuance of bonds backed by companies other than Fannie Mae
FNM.P FNM.N, Freddie Mac FRE.P FRE.N and Ginnie Mae has
virtually come to a halt as investors refuse to buy securities
backed by loans where payments are not guaranteed.
Bank of America Corp (BAC.N) was the top underwriter of
U.S. mortgage-backed securities for the first quarter of 2010,
the survey showed.
Bank of America underwrote 21 issues of mortgage-backed
bonds, totaling $45.4 billion, a 38.3 percent market share.
Goldman Sachs & Co (GS.N) ranked second among U.S. MBS
underwriters in that quarter, with a 9.5 percent share. The
firm underwrote 12 issues worth $11.2 billion.
Barclays Capital, the investment banking arm of UK lender
Barclays (BARC.L), ranked third, with an 8.3 percent share. The
firm underwrote 11 issues worth $9.9 billion.
Originators have shifted supply to the agency MBS market.
The agency MBS market has overwhelmingly captured the lion's
share of issuance in 2007, 2008, 2009 and so far in 2010, with
non-agency mortgage origination virtually nonexistent as buyers
fled the sector on growing concerns about mortgage
Thomson Reuters tracks mortgage bonds backed by whole
commercial and residential real estate loans as well as the
mortgage-backed securities initially packaged by Fannie Mae,
Freddie Mac and Ginnie Mae. Interest-only and principal-only
strips of the so-called agencies are not tracked.
(Reporting by Julie Haviv; Editing by Kenneth Barry)