Ginnie Mae’s MBS Balance Continues to Climb

A recent press release from the Government National Mortgage Association, or Ginnie Mae, the organization’s total outstanding principal balance related to its mortgage-backed securities (MBS) has inched up to $1.971 trillion in June 2018, an $11 billion increase since the May 2018 reporting.

Ginnie Mae is a wholly-owned government corporation that attracts global capital into the housing finance system to support homeownership for veterans and millions of homeowners throughout the country. Ginnie’s report reveals that MBS issuance thus far for Fiscal Year 2018 (FY 2018) totaled $323.337 billion, to the end of May. The $1.971 trillion total outstanding principal balance as of the end of June was up from $1.842 trillion in June 2017.

Ginnie’s MBS issuance for June 2018 totaled $37 billion, including $35.330 billion of Ginnie Mae II MBS and $1.669 billion of Ginnie Mae I MBS. This also included $1.024 billion of loans for multifamily housing. That overall total is up slightly from May’s total of $35 billion, which included $33.431 billion of Ginnie Mae II MBS and $1.890 billion of Ginnie Mae I MBS.

Per Ginnie’s statement, Ginnie Mae I MBS “are modified pass-through mortgage-backed securities on which registered holders receive separate principal and interest payments on each of their certificates.” Ginnie Mae I MBS include single-family, multifamily, manufactured home, and project construction loans.

Ginnie Mae II MBS “are modified pass-through mortgage-backed securities for which registered holders receive an aggregate principal and interest payment from a central paying agent. An issuer may participate in the Ginnie Mae II MBS either by issuing custom, single-issuer pools or through participation in the issuance of multiple-issuer pools, which combine loans with similar characteristics.”

There have been several noteworthy developments within Ginnie of late. Last month, Ginnie issued an All Participants Memorandum (APM) announcing the implementation of changes to pooling eligibility requirements for Department of Veteran Affairs' (VA) insured or guaranteed mortgages under the "Loan Seasoning for Ginnie Mae Mortgage-Backed Securities," provision. These changes affect security issuances on or after June 1, 2018, but do not otherwise affect the guarantee or composition of MBS issued before that date. You can read more about the changes by clicking here.

In May, the White House announced that President Trump was nominating Michael R. Bright as the President of Ginnie. If confirmed, Bright would be the agency’s first permanent head since Ted Tozer stepped down in January 2017, wrapping up a seven-year tenure as head of Ginnie. Bright wouldn’t be new to Ginnie—he has served as Ginnie’s VP and COO since the middle of 2017. In that role, Bright manages Ginnie's portfolio of mortgage-backed securities. You can read more about Bright’s background and qualifications by clicking here.