ASF
360 Madison Avenue
17th Floor
New York, NY
10017-7111
646.637.9211
George Miller
Executive Director
646.637.9216
Tom Deutsch
Associate Director
646.637.9235
Tere Petersen
Director, Events & Marketing
646.637.9236
Jooho Lee
Analyst
646.637.9259
Justin Ross
Analyst
646.637.9238
To update your contact information, please email
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© 2007 American Securitization Forum
May 24, 2007
Upcoming ASF Meetings & Events
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May 24: ASF Loan Modifications Working Group Meeting, 4-5 PM (ET)
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May 25: ASF Membership Committee Call, 11 AM-12 PM (ET)
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June 5: ASF Student Loan Issuers Subforum Call, 11 AM-12 PM (ET) ASF Board of Directors Meeting, 5-6:30 PM (ET)
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June 6: ASF 2007 Annual Meeting, 7:30 AM-6:30 PM (ET) Grand Hyatt, New York
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June 19: ASF Tax Subcommittee Meeting, 4-5:30 PM (ET)
Securitization-Related News and ASF Advocacy
SEC Adopts Rules on Credit Rating Agency Oversight: On May 23, the SEC voted to adopt final rules to implement provisions of the Credit Rating Agency Reform Act of 2006, which was enacted by Congress on September 29, 2006. The rules are designed to improve competition among nationally recognized statistical rating organizations (NRSRO) and prevent unfair and abusive practices in the industry. The rules detail the procedure for applying and registering as an NRSRO, recordkeeping requirements for NRSROs and requirements designed to protect NRSRO impartiality. The SEC had released proposed rules on credit rating agency oversight in February, 2007 and the ASF had submitted a comment letter to the SEC on March 22, 2007. Please click here for the SEC's press release on the final rules and here for the ASF comment letter.
ASF Loan Modifications Working Group Meeting: The ASF Loan Modifications Working Group will be meeting today at 4 PM (ET) to discuss the current draft of an ASF statement of principles, guidance and recommendations for the modification of securitized subprime mortgage loans. Please contact George Miller for more information.
Senators Urge Regulators to Finalize Subprime Guidance: On May 18, several senators, including Christopher Dodd (D-CT), Chairman of the Senate Committee on Banking, Housing and Urban Affairs, released a letter to federal regulators commending their decision to extend the protections and underwriting requirements established by the Nontraditional Mortgage Guidance to subprime borrowers, and urging them to finalize the guidelines as quickly as possible. The letter also urges the regulators to encourage servicers to abide by the Statement of Principles that a number of industry participants had agreed to after Chairman Dodd convened a Homeownership Preservation Summit in April. Please click here for the letter and here for more information.
Financial Services Trade Groups Issue Statement on Subprime Lending: On May 21, the American Bankers Association, America's Community Bankers, the Consumer Bankers Association, the Housing Policy Council, the Financial Services Roundtable, and the Mortgage Bankers Association released a joint statement on subprime lending, expressing their support for the efforts by the industry and the federal banking regulatory agencies to strengthen underwriting standards and to protect borrowers against unfair and deceptive mortgage lending practices. The statement lists three principles on which future regulatory actions should be based and notes that any action taken by policymakers should involve all participants and establish a single uniform national standard. Please click here for the statement and here for a statement of responsible non-prime lending practices and key principles issued by the Housing Policy Council and the Financial Services Roundtable on April 9, 2007.
Federal Reserve Director Testifies on Subprime Lending and Foreclosures: On May 21, Sandra Braunstein, Director of the Federal Reserve Board's Division of Consumer and Community Affairs, testified before the House Oversight and Government Reform Subcommittee on Domestic Policy on subprime mortgage lending. She indicated that "the Board believes that mortgage market problems need to be addressed in a way that addresses unfair and abusive practices while preserving incentives for responsible subprime lenders" and that "it is important that any actions we take are well calibrated and do not have unintended consequences." She noted that federal regulators have issued guidance over the last fifteen years "as a result of an evolving mortgage lending market" and that a "hearing in June will be used to gather information on how the Board might use its rulemaking authority to curb abusive lending practices in the home mortgage market." Please click here for her testimony.
Comptroller of the Currency Speaks on Subprime Lending: On May 23, Comptroller of the Currency John Dugan gave a speech to the Neighborhood Housing Services of New York on the use of unverified "stated income" subprime loans. He believes that "stated income is appropriate in some cases, but that it should be the exception and not the rule in subprime lending." He noted that "our job as regulators is to make sure that the institutions we supervise understand and are capable of managing the risks associated with particular underwriting choices, and that customers are treated fairly" and that "in the past, the banking agencies have addressed the use of stated income in interagency guidance on both home equity loans and nontraditional mortgages. Now we must decide whether to address the practice even more strongly in the context of subprime mortgage lending as we finalize the proposed guidance." Please click here for the speech and here for more information.
House Passes GSE Reform Bill: On May 22, the US House of Representatives passed H.R. 1427, the Federal Housing Finance Reform Act of 2007, by a vote of 313 to 104. The bill will overhaul the regulatory oversight of the government sponsored enterprises (GSE) of Fannie Mae, Freddie Mac and the Federal Home Loan Banks, and create a new, independent regulator with broad powers analogous to current banking regulators. The regulator's primary responsibility will be to ensure the safety and soundness of the institutions. In addition, the bill creates an off-budget and non-taxpayer financed affordable housing fund, which will dedicate hundreds of millions of dollars for the construction, maintenance and preservation of affordable housing. Please click here for more information.
Federal Reserve Board Issues Proposed Amendments to Regulation Z: On May 23, the Federal Reserve Board issued for public comment proposed amendments to Regulation Z, which implements the Truth in Lending Act. The amendments are intended to improve the effectiveness of the disclosures consumers receive in connection with credit card accounts and other revolving credit plans by ensuring that information is provided in a timely manner and in a form that is readily understandable. The proposed amendments principally focus on the rules for open-end credit accounts that are not home-secured, chiefly general-purpose and retail credit card plans. Please click here for more information, including links to the proposed amendments. Comments are due 120 days after the proposals are published in the Federal Register.
Federal Reserve Board Governor Speaks on Consumer Credit Disclosures: On May 23, Federal Reserve Board Governor Randall S. Kroszner spoke at the George Washington University School of Business Financial Services Research Program Policy Forum on consumer credit disclosures. He noted that the Board has been conducting "extensive, in-depth interviews with individual (credit card) consumers to study the effectiveness of disclosures" and will be using similar methods to study mortgage loan disclosures. He indicated that "in fulfilling its responsibility to protect consumers, the Federal Reserve will do all that it can to prevent fraudulent and abusive mortgage lending practices. Because information is critical to more competitive, and thus more efficient, markets, effective disclosure also has the capacity to weed out abuses." Please click here for the speech.
FASB Issues Staff Position on FIN 46(R): On May 11, the Financial Accounting Standards Board (FASB) issued FASB Staff Position (FSP) No. FIN 46(R)-7, "Application of FASB Interpretation No. 46(R) to Investment Companies." The FSP addresses the application of FASB Interpretation No. 46, Consolidation of Variable Interest Entities, by an entity that accounts for its investments in accordance with the specialized accounting guidance in the AICPA Audit and Accounting Guide, Investment Companies. The FSP notes that investments accounted for at fair value in accordance with the specialized accounting guidance in the AICPA Audit and Accounting Guide are not subject to consolidation according to the requirements of FIN 46(R). Please click here for the FSP.
HUD Publishes Study of HECM Loan Level Data: The US Department of Housing and Urban Development (HUD) has published a study entitled, "Home Equity Conversion Mortgage (HECM) Terminations: Information To Enhance the Developing Secondary Market" which analyzed 16 years of HECM loan level data. Among other things, the study discusses the challenges associated with securitizing reverse mortgages and "provides termination information in the form of discrete-time hazard and survival rate tables using historical HUD HECM data and standard life-table techniques" in order to support the development of an efficient secondary market for HECM loans. Please click here for the study and here for a press release from Ginnie Mae commending the study. Ginnie Mae will issue its first HECM MBS later in 2007.
Conferences/Events
ASF Annual Meeting Registration Deadline: Online registration for the ASF 2007 Annual Meeting ends TOMORROW, May 25. After tomorrow, registrations will only be accepted at the walk-in registration desk. All walk-in registrants, including investors and employees of sponsoring organizations, will be charged a $25 on-site administrative fee. Key players in the securitization industry will share their views and perspectives at this unique event, which will feature FDIC Chairman Sheila Bair as the keynote speaker. Don't miss the opportunity to network with the leaders of the industry. Please click here to register and here for the agenda, listing many of the speakers who are confirmed to participate.
ASF Securitization Institute Faculty Nominations Deadline June 1: The ASF is seeking nominations for faculty members to develop and present course materials and content for the ASF Securitization Institute, ASF's comprehensive training and education program on core securitization market topics and concepts taught by distinguished securitization market participants. We are currently inviting experienced and knowledgeable industry members—the "leading lights" of the industry—to serve as faculty members for each of the sessions. Please submit all nominations by June 1. Please click here to submit nominations and here for more information about the Institute, including dates for upcoming offerings and links to register.