HREMIC issuance for the first nine months of 2015 was $6.5 billion, easily surpassing 2014’s full year $5 billion of issuance, and the previous full year record of $6 billion set in 2012. There were 23 transactions underwritten by four sponsors, Nomura, Bank of America Merrill Lynch, Credit Suisse and Barclays. Nomura remains the #1 issuer for the first nine months, with $2.4 billion, Bank of America Merrill Lynch was second with $2.2 billion, and Credit Suisse was third with 6 issuances totaling $1.3 billion, though CS issued no new securities in the third quarter. Barclays rounded out the group with $611 million issued through three transactions for a 9% market share. Life-to-date BAML has issued 44% of all HREMICs, Barclays 14%, and Nomura 12%.
Approximately 60% of outstanding HMBS securities have now been resecuritized into HREMICs.
HREMIC collateral consists of HMBS, which are Ginnie Mae guaranteed pass-through securities. HMBS are backed by pools of participations of HECMs, which are FHA-insured reverse mortgages. This double layer of government guarantee, combined with the relatively high coupon and favorable prepayment patterns of the underlying loans, results in very favorable execution, even when compared to other Ginnie Mae “forward mortgage” securities.
New View Advisors compiled these rankings from publicly available Ginnie Mae data.
