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Strategic Analytics Enhances MBS Analysis

Santa Fe, New Mexico-based ""Strategic Analytics Inc."":http://www.strategicanalytics.com , a provider of stress testing and forecasting solutions for retail lenders, announced Thursday a partnership with Maryland's ""BlackBox Logic, LLC"":http://blackboxlogicllc.com, a provider of loan-level mortgage data and cash flow analysis for securitized mortgage products.
According to Strategic Analytics, BlackBox is one of the largest repositories of loan-level mortgage data within the global financial services industry and will provide Strategic Analytics with data and performance updates for more than 7,200 residential mortgage-backed securities (RMBS) representing more than 92 percent of all U.S. mortgage loans.
Strategic Analytics explained that BlackBox's service transforms data from bond trustees and securities issuers into usable business information through its proprietary process of normalizing and cleansing. The company says its newly expanded mortgage database, together with its patented forecasting and stress-testing analytical software, lets clients analyze portfolios with a degree of accuracy not possible with thinner data sets or weaker models, producing both high-level analysis and the ability to drill-down to loan-level segments, such as metropolitan area, asset types, and loan types.
The fall in home prices began in 2007. Strategic Analytics says virtually all other commercial modeling platforms showed no visible stress until 2007 when price depreciation was evident, but the company says its approach provided accurate predictions of loan losses two years earlier.
In 2005, Strategic Analysis explained, analysis of industry-wide U.S. mortgage data utilizing its software showed that the quality of new originations was deteriorating even though the economy was relatively unchanged and credit scores had not moved. By 2006 and 2007, the quality of new originations had declined and Strategic Analytics said its analysis indicated that the mortgage market was heading for an enormous collapse.
Strategic Analytics’ software and services are used by eight of the top 10 banks with the largest U.S. consumer loan portfolios, analyzing more than $2 trillion in retail loans worldwide.

About Author: Carrie Bay

Carrie Bay is a freelance writer for DS News and its sister publication MReport. She served as online editor for DSNews.com from 2008 through 2011. Prior to joining DS News and the Five Star organization, she managed public relations, marketing, and media relations initiatives for several B2B companies in the financial services, technology, and telecommunications industries. She also wrote for retail and nonprofit organizations upon graduating from Texas A&M University with degrees in journalism and English.
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