Ginnie Mae announced today that investors purchased a record $32 billion of Platinum Securities spread across 217 pools in the fiscal year that ended September 30. Platinum Securities volume in fiscal year 2018 was approximately $20 billion.
Ginnie Mae Platinum Securities are issued through the Ginnie Mae Multiclass Securities Program and provide investors of mortgage-backed securities (MBS) with greater market and operating efficiencies. Investors who hold multiple pools of MBS can combine new or existing MBS into a single Ginnie Mae Platinum Certificate. Once a Ginnie Mae Platinum Certificate has been created, it can be used efficiently in structured finance transactions, repurchase transactions and general trading.
The record volume caps a strong year for the Ginnie Mae Platinum program. In April, Ginnie Mae introduced a Platinum product for Home Equity Conversion Mortgages (HECMs). The new Platinum product, known as HMBS, was the latest evolution in the modernization of Ginnie Mae’s Platinum Securities Program, which has been adding investor-focused functionality since 2017. Today, investors can create Platinum products using fixed-rate MBS (15- and 30-year mortgages); Weighted Average Coupon (WAC) Adjustable Rate Mortgage (ARM) and Jumbo Only Fixed mortgages.
The market adoption of the modernized process for Platinum products has been strong: prior to modernization, fiscal year 2017 production of Platinum securities with fixed-rate collateral was only $7.88 billion. Following modernization and automation inside the new MyGinnieMae portal, volume grew to more than $20 billion in fiscal year 2018.
“The results this year clearly demonstrate that our Platinum program modernization efforts are aligned with the needs of investors,” said John Daugherty, SVP, Office of Securities Operations. “Making it simpler for investors to manage their portfolio of Ginnie Mae securities, while enhancing the liquidity of their Ginnie Mae investments, supports our mission to foster a strong secondary mortgage market for government mortgage loans. We’re helping borrowers across the U.S. obtain the lowest mortgage rates an efficient market can offer.”
Modernization of Ginnie Mae’s technology and business processes is a key feature of the agency’s strategic plan. More of Ginnie Mae’s operational and technology modernization goals can be found in the progress update of the Ginnie Mae 2020 paper.
About Ginnie Mae
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 Mae mortgage-backed securities (MBS) programs directly support housing finance programs administered by the Federal Housing Administration, the Department of Veterans Affairs, the Housing and Urban Development’s Office of Public and Indian Housing and the Department of Agriculture Rural Housing Service. Ginnie Mae is the only MBS to carry the explicit full faith and credit of the United States government.
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 securities can 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.
Contact: Douglas Robinson