HREMIC issuance for the first quarter of 2014 was off 41% from the first quarter of 2013, with just 6 transactions totaling $957 million. Only 1 HREMIC was issued in March. In the first quarter of 2013, 8 transactions totaling $1.66 billion were issued.
Bank of America Merrill Lynch continues its dominance in the space with a 56% market share, issuing $538.4 million of HREMICs. Stifel was second with 2 issuances totaling $300.8 million, and RBS had one transaction for $118.2 million.
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.
