According to the latest data from Ginnie Mae, its mortgage-backed securities (MBS) portfolio outstanding grew to $2.59 trillion in May 2024, including $36.9 billion of total MBS issuance, resulting in $14.3 billion in net growth. May’s new MBS issuance supports the financing of more than 116,000 households, including more than 58,000 first-time homebuyers. Approximately 74% of the May MBS issuance reflects new mortgages that support home purchases because refinance activity remained low due to higher interest rates.
Ginnie Mae reports that the May issuance includes $36.1 billion of Ginnie Mae II MBS and $804 million of Ginnie Mae I MBS, including $655 million in loans for multifamily housing.
For the 2024 calendar year to date, Ginnie Mae has supported the pooling and securitization of more than 249,000 first-time homebuyer loans.
Month-over-month growth
Last month, Ginnie Mae’s MBS portfolio outstanding grew to $2.57 trillion in April 2024, including $34.8 billion of total MBS issuance, leading to $14.1 billion of net growth. Approximately 73% of the April MBS issuance reflects new mortgages that support home purchases because refinance activity remained low due to higher interest rates. The April issuance includes $34.2 billion of Ginnie Mae II MBS and $549 million of Ginnie Mae I MBS, including $463 million in loans for multifamily housing.
Increasing risk management
Ginnie Mae also recently issued All Participants Memorandum (APM) 24-08, announcing recovery planning requirements for non-depository Issuers whose portfolios equal or exceed a remaining principal balance (RPB) of $50 billion at the end of the calendar year. The initial recovery plans for the calendar year 2024 are due no later than June 30, 2025. Issuers’ recovery plans must include information related to its organizational structures, as well as technology systems to provide Ginnie Mae with visibility into an Issuer’s core information systems leveraged to service its Ginnie Mae portfolio.
Through the issuance of APM 24-08, Ginnie Mae will evaluate the recovery plans submitted by the Issuers, notifying them of either approval or the need for additional information. Issuers will be required, every two years, to update and resubmit their recovery plans or attest that the most recently approved recovery plan, including any out-of-cycle material changes made to their plan, remains current.
“Ginnie Mae takes a multi-faceted approach to risk management,” said Ginnie Mae President Sam Valverde. “Our new recovery planning requirements are a key component to manage counterparty risk and support seamless guaranty operations.”
The new Issuer requirements will assist Ginnie Mae in upholding its government-backed guaranty, should an Issuer fail to meet the obligations outlined in the MBS Guide and Guaranty Agreement(s), and to ensure that the MBS program requirements appropriately reflect the risk associated with certain Issuer profiles. In the event that an Issuer fails to meet its obligations, these recovery plans will play a key role in Ginnie Mae’s ability to transfer servicing responsibilities.
