LIBOR Mortgages Pose Basis, Legal and Practical Risk for UK RMBS

The discontinuation of LIBOR could introduce basis risk for the UK non-conforming and buy-to-let (BTL) RMBS markets if assets and liabilities reset to different reference rates. Senior tranches are well protected, but junior tranches of legacy non-conforming transactions and excess spread notes of more recent BTL securitisations are more exposed.

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A series of comments published by Fitch on the transition away from IBOR.

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Rising Inventory Slowing U.S. Home Price Growth

National home price growth remains stable throughout much of the country, though Fitch Ratings' latest U.S. quarterly sustainable home price report shows the rate of growth slowing down.

IBOR Transition Makes Progress, but Key Risks Unaddressed

Substantial progress in recent months will better prepare financial markets for the discontinuation of IBOR indices, but transition risks remain, Fitch Ratings says in a new report. Our ratings address the payment of interest (and principal) in accordance with the underlying terms of an obligation and would not be directly affected by transition from one reference rate to another or any accompanying spread adjustment. 

Slower Spain Repossessions Offset by Market Practice Shifts

We see the change as compatible with Fitch's recovery timing expectation on defaulted mortgages of four years in our RMBS base case scenario. This already incorporates a buffer over the observed historical average recovery time of around three years.

Fitch Ratings Adds Goldman Sachs as U.S. RPL RMBS Aggregator

Re-performing loans (RPLs) continue to be an attractive collateral choice for newly issued RMBS, and Fitch Ratings has added Goldman Sachs Mortgage Company (GSMC), an established industry participant, to its coverage of RPL aggregators.

Nevada Home Prices Frothier; Northwest Cools

Home price growth in the Northwest has slowed a bit while the most overvalued housing market in the country has not let up, according to Fitch Ratings in its latest U.S. sustainable home price quarterly report. 

Risks to Global Housing Markets – What to Watch in 2019 Webinars

Senior analysts from Fitch’s global RMBS and covered bonds team will discuss the risks to global housing markets in 2019. Across three individual webinars, the team will outline their forecasts for housing markets across the globe focussing on countries facing falling prices, high household indebtedness and political uncertainty. 

Europe: Thursday 17th January – 10:00 GMT 

Americas: Thursday 17th January – 15:00 GMT / 10:00 EST

Asia-Pacific:  Tuesday 23rd January – 10:00 HKT

2019 Outlook: Global Housing and Mortgage

Stretched affordability and overheated home prices in several major cities have been key themes of our global housing and mortgage outlooks for the past five years. Now as part of our 2019 Outlooks series, we take a forward look at this sector for the year ahead.

Press Release: Global Home Price Growth under Pressure

2019 Risks to Watch - Global Housing Markets

As part of our Risks to Watch series, Suzanne Albers, Senior Director on the Structured Finance team, discusses key credit concerns across global housing markets over the next 12 months.

NA Housing, Mortgage Market May Face New Challenges in 2019

Relatively solid sector fundamentals and macroeconomic conditions support a stable housing and mortgage outlook for the US and Canada in 2019, according to Fitch Ratings. However, slower home price appreciation, subdued mortgage lending growth and US policy may present challenges. 

Global Home Price Growth under Pressure

Fitch Ratings says that more countries will face challenges to home price growth in 2019 from high household debt levels, political risk, slowing economic growth and stretched borrower affordability. 

Late-Cycle Risk Grows for NA Structured Finance in 2019

The structured finance markets in North America are positioned for another stable year in 2019; however, Fitch Ratings' outlook report points to several noteworthy external factors investors should consider.

Rising Rates, End of LIBOR to Challenge U.S. RMBS Servicers

The future trajectory of interest rates will remain very important next year for U.S. RMBS servicers, according to participants at Fitch Ratings' recent U.S. RMBS servicer roundtable event. 

New US RMBS Structure Increases Senior Class Risk

A new prime U.S. RMBS transaction that allocates greater credit risk to senior bondholders highlights key differences among rating agencies, according to Fitch Ratings. The transaction, Galton Funding Mortgage Trust (GFMT) 2018-2, is not rated by Fitch.

More Unsolicited SF Comments are Likely due to Late-Cycle Behavior

Late-cycle credit behaviour is manifesting in securitisations more frequently of late, which has triggered more unsolicited commentaries from Fitch Ratings on structured finance deals not rated by the agency and in certain sectors, according to the rating agency in a new report.

Post-Crisis U.S. RMBS Continues Strong Performance

Prime performance remains strong through the first half of 2018, reflecting the high-quality collateral attributes strong macroeconomic conditions and continued home price growth, with 60+ delinquencies (DQs) averaging only 11 basis points for Fitch-rated prime transactions.