Bear Stearns Mortgage Analysts Publish Comprehensive Default Analysis of the Jumbo MBS Sector.Business Editors NEW YORK--(BUSINESS WIRE)--June 6, 2000 Bear, Stearns & Co. Inc. managing directors and mortgage research analysts Satish M. Mansukhani and Bruce Kramer today announced the completion of a comprehensive loan-level analysis of default performance in the jumbo mortgage In the United States, a jumbo mortgage is a mortgage with a loan amount above the industry-standard definition of conventional conforming loan limits. This standard is set by the two largest secondary market lenders, Fannie Mae and Freddie Mac. sector. Full details of their findings are presented in a report entitled Analyzing Loan-level Default Performance in the Jumbo MBS See Mb/sec. MBS - mobile broadband services Sector. Since the inception of the non-agency MBS market, transparency in credit-sensitive sectors has been hurt by the lack of full loan-level disclosure of default and loss data. The recent release of loan-level information by the Residential Funding Corporation (RFC (Request For Comments) A document that describes the specifications for a recommended technology. Although the word "request" is in the title, if the specification is ratified, it becomes a standards document. ) on all issues since the late 1980s has greatly improved data transparency (1) The ability to easily access and work with data no matter where they are located or what application created them. (2) The assurance that data being reported are accurate and are coming from the official source. in the sector. Today, market access to full loan-level loss data sets apart a handful of issuers, such as Prudential Home Mortgage Securities Corporation, Norwest Asset Securities Corporation and Residential Funding Corporation (RFC). This new data availability Refers to the degree to which data can be instantly accessed. The term is mostly associated with service levels that are set up either by the internal IT organization or that may be guaranteed by a third party datacenter or storage provider. should enhance both deal execution and the secondary market liquidity of their products. Given the expanded understanding of default behavior made possible by this data, the analysts hope that all issuers of mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. will commit to full property-level disclosure. This study enhances Bear Stearns' commitment to bringing the benefits of loan-level transparency to investors in the mortgage and asset-backed markets. The results of this analysis should be of interest to institutional investors, analysts and rating agencies. Readers will be provided with a full cross-issuer, loan-level historical comparison of the default and loss performance of jumbo mortgages. In addition to providing historical performance benchmarks that cover a wide variety of economic and mortgage rate environments, the study will point to relative value opportunities that currently exist in the jumbo-subordinate sector. In the future, as more loss information is added to the Bear Stearns databases, this analytical framework should provide further insights into the default performance of jumbo loans. To obtain a copy of the report or to speak to Satish M. Mansukhani or Bruce Kramer, please call Lynn Verrecchio on (212) 272-3299. Founded in 1923, The Bear Stearns Companies Inc. (NYSE NYSE See: New York Stock Exchange : BSC (Binary Synchronous Communications) See bisync. ) is the parent company of Bear, Stearns & Co. Inc., a leading investment banking and securities trading and brokerage firm serving governments, corporations, institutions and individuals worldwide. With approximately $23.2 billion in total capital, the company's business includes corporate finance and mergers and acquisitions, institutional equities and fixed income sales, trading and research, private client services, derivatives, foreign exchange and futures sales and trading, asset management and custody services. Through Bear, Stearns Securities Corp., it offers global clearing services to broker dealers, prime broker clients and other professional traders, including securities lending Securities Lending When a brokerage lends securities owned by its clients to short sellers. Notes: This allows brokers to create additional revenue (commissions) on the short sale transaction. . Headquartered in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , the company has more than 10,300 employees located in domestic offices in Atlanta, Boston, Chicago, Dallas, Los Angeles, San Francisco and San Juan; and an international presence in Beijing, Buenos Aires, Dublin, Hong Kong, London, Lugano, Sao Paulo, Shanghai, Singapore and Tokyo. For additional information about Bear Stearns, please visit our Web site at http://www.bearstearns.com. |
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