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Well It nothing gonna happen until next week then we'll see.. GL
U.S. watchdog to file on force-place policies: WSJ
1:11a ET March 26, 2013 (MarketWatch)
U.S. watchdog to file on force-place policies: WSJ
SYDNEY (MarketWatch) -- The Federal Housing Finance Agency, which overseas U.S. mortgage providers Fannie Mae and Freddie Mac, plans Tuesday to file a notice to prevent insurers from paying fees and commissions to banks over so-called force-place insurance, The Wall Street Journal reported. Force-place insurance is taken up by homeowners whose standard coverage has lapsed, the report said. Paying fees to banks can provide an incentive to arrange more expensive insurance, the report said.
-Sarah Turner; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
March 26, 2013 01:11 ET (05:11 GMT)
Copyright (c) 2013 Dow Jones & Company, Inc.SN201303260000802013-03-26 05:11:00.0000NV7L9FVB2CMCE2C28LDB9UB5TDJNF
http://research.tdameritrade.com/grid/public/stocks/news/story.asp?docKey=1-SN20130326000080-0NV7L9FVB2CMCE2C28LDB9UB5T
U.S. Crack Down on 'Forced' Insurance
By ?Alan Zibel and ?Leslie Scism
WASHINGTON-A U.S. housing regulator is cracking down on a little-known practice that has hit millions of struggling borrowers with high-price homeowners' insurance policies arranged by banks that benefit from the costly coverage.
The Federal Housing Finance Agency , which regulates mortgage giants Fannie Mae and Freddie Mac , plans to file a notice Tuesday to ban lucrative fees and commissions paid by insurers to banks on so-called force-placed insurance.
Such "forced" policies are imposed on homeowners whose standard property coverage lapses, typically because the borrower stops making payments. Critics say the fee system has given banks a financial incentive to arrange more expensive homeowners' policies than necessary.
Banning the fees and commissions could help lower the price of the insurance policies. The housing agency's move would apply nationwide to all mortgages guaranteed or owned by Fannie and Freddie-about half of the housing market.
Forced policies have boomed in the wake of the housing bust, as many homeowners struggled to keep up with mortgage payments. Some borrowers may try to save money by dropping the original standard coverage, only to be hit by policies with premiums that are typically at least twice as expensive as voluntary insurance, and sometimes cost as much as 10 times more. Nearly six million such policies have been written since 2009, insurance industry data indicate. Consumers are free at any point to replace a force-placed policy with one of their own choosing.
Property insurance generally is required to secure a mortgage and protects not only the homeowner's investment but also the lender's.
Regulators say some consumers don't read warning letters that they will be subject to potentially more-expensive coverage if they don't restore their original coverage or line up some other homeowners' policy.
They only realize months into the new arrangement that the amount they are being billed is much higher than they previously paid for coverage.
Banks and insurers maintain that consumers are given adequate notice. But state and federal regulators are concerned that prices of the policies are being artificially inflated because of financial relationships between banks and insurers.
Some banks have stopped receiving commissions as scrutiny increased over the past couple of years. Many receive sales commissions through affiliated insurance agents and some also share in the estimated $2.6 billion in annual premiums through bank-owned reinsurance companies.
New York regulators last year found nearly 15% of the premiums from force- placed policies flow back to the banks. Banks' commissions on the force-placed policies frequently top more than 10% of the homeowners' annual premiums of about $2,000 , according to regulators.
The FHFA's planned notice, which was viewed by The Wall Street Journal , will be submitted to the Federal Register. The agency will seek public input for 60 days but noted the force-placed industry's compensation practices are " sufficiently distinct as to merit early action." The FHFA could make adjustments to the rule based on comments from mortgage-industry players.
The issue is important to Fannie Mae and Freddie Mac because they pick up a large portion of the bill for unpaid insurance costs. Fannie Mae is annually spending $390 million for the insurance, with another $110 million paid by borrowers, according to a 2012 internal presentation viewed by the Journal. The FHFA, in its planned notice, said demand for force-placed policies has risen since the financial crisis, driving up costs to Fannie and Freddie.
Last month, the FHFA rejected a plan by Fannie Mae to cut the costs of the insurance by 30% to 40% by bringing in a group of insurers to inject more competition in the market. That approach would have applied only to Fannie Mae , and the regulator wanted to establish a broader approach that would apply to the entire housing market, Edward DeMarco , the FHFA's acting director, has said.
Banks and the insurers have defended the fees and premiums as appropriate for the costs and risks they incur in arranging coverage. Insurers maintain the insured properties often are vacant and uninspected, and many are in hurricane- prone Florida .
A spokesman for Assurant Inc. , the largest seller of the insurance in the U.S., said: "It would be premature to project what FHFA might do regarding lender-placed insurance. We've worked with Fannie and Freddie for years, and look forward to continuing to work with them and FHFA as they look to control costs and help move the industry forward." A spokeswoman for QBE Insurance Group , the other major player, declined to comment.
Last week, Assurant agreed to pay a $14 million penalty and provide restitution to some New York homeowners to settle state allegations of overpriced insurance and excessive profits. New York Gov. Andrew Cuomo said the pact addresses an "intricate web of relationships between insurers and banks" pushing some homeowners into foreclosure.
In an example cited by the state in its announcement last week, New York regulators said J.P. Morgan Chase & Co. "has made approximately $600 million since 2006" through reinsurance transactions with Assurant .
A J.P. Morgan spokeswoman described the bank's arrangement as a "risk-sharing relationship," meaning it profited by taking on some underwriting risk. She said J.P. Morgan receives "no commissions" from Assurant .
"We continue to work with regulators to deliver collateral insurance in the best way possible," said Kevin McKechnie , executive director for the American Bankers Association's office of insurance advocacy. The New York action, he said, "could limit the number of servicers and force smaller institutions out of the business, which would have a negative impact on consumers."
Write to ?Alan Zibel at ?Alan.Zibel@wsj.com and ?Leslie Scism at ?Leslie.Scism@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
03-25-13 2245ET
Copyright (c) 2013 Dow Jones & Company, Inc.
U.S. Crack Down on 'Forced' Insurance
By ?Alan Zibel and ?Leslie Scism
WASHINGTON-A U.S. housing regulator is cracking down on a little-known practice that has hit millions of struggling borrowers with high-price homeowners' insurance policies arranged by banks that benefit from the costly coverage.
The Federal Housing Finance Agency , which regulates mortgage giants Fannie Mae and Freddie Mac , plans to file a notice Tuesday to ban lucrative fees and commissions paid by insurers to banks on so-called force-placed insurance.
Such "forced" policies are imposed on homeowners whose standard property coverage lapses, typically because the borrower stops making payments. Critics say the fee system has given banks a financial incentive to arrange more expensive homeowners' policies than necessary.
Banning the fees and commissions could help lower the price of the insurance policies. The housing agency's move would apply nationwide to all mortgages guaranteed or owned by Fannie and Freddie-about half of the housing market.
Forced policies have boomed in the wake of the housing bust, as many homeowners struggled to keep up with mortgage payments. Some borrowers may try to save money by dropping the original standard coverage, only to be hit by policies with premiums that are typically at least twice as expensive as voluntary insurance, and sometimes cost as much as 10 times more. Nearly six million such policies have been written since 2009, insurance industry data indicate. Consumers are free at any point to replace a force-placed policy with one of their own choosing.
Property insurance generally is required to secure a mortgage and protects not only the homeowner's investment but also the lender's.
Regulators say some consumers don't read warning letters that they will be subject to potentially more-expensive coverage if they don't restore their original coverage or line up some other homeowners' policy.
They only realize months into the new arrangement that the amount they are being billed is much higher than they previously paid for coverage.
Banks and insurers maintain that consumers are given adequate notice. But state and federal regulators are concerned that prices of the policies are being artificially inflated because of financial relationships between banks and insurers.
Some banks have stopped receiving commissions as scrutiny increased over the past couple of years. Many receive sales commissions through affiliated insurance agents and some also share in the estimated $2.6 billion in annual premiums through bank-owned reinsurance companies.
New York regulators last year found nearly 15% of the premiums from force- placed policies flow back to the banks. Banks' commissions on the force-placed policies frequently top more than 10% of the homeowners' annual premiums of about $2,000 , according to regulators.
The FHFA's planned notice, which was viewed by The Wall Street Journal , will be submitted to the Federal Register. The agency will seek public input for 60 days but noted the force-placed industry's compensation practices are " sufficiently distinct as to merit early action." The FHFA could make adjustments to the rule based on comments from mortgage-industry players.
The issue is important to Fannie Mae and Freddie Mac because they pick up a large portion of the bill for unpaid insurance costs. Fannie Mae is annually spending $390 million for the insurance, with another $110 million paid by borrowers, according to a 2012 internal presentation viewed by the Journal. The FHFA, in its planned notice, said demand for force-placed policies has risen since the financial crisis, driving up costs to Fannie and Freddie.
Last month, the FHFA rejected a plan by Fannie Mae to cut the costs of the insurance by 30% to 40% by bringing in a group of insurers to inject more competition in the market. That approach would have applied only to Fannie Mae , and the regulator wanted to establish a broader approach that would apply to the entire housing market, Edward DeMarco , the FHFA's acting director, has said.
Banks and the insurers have defended the fees and premiums as appropriate for the costs and risks they incur in arranging coverage. Insurers maintain the insured properties often are vacant and uninspected, and many are in hurricane- prone Florida .
A spokesman for Assurant Inc. , the largest seller of the insurance in the U.S., said: "It would be premature to project what FHFA might do regarding lender-placed insurance. We've worked with Fannie and Freddie for years, and look forward to continuing to work with them and FHFA as they look to control costs and help move the industry forward." A spokeswoman for QBE Insurance Group , the other major player, declined to comment.
Last week, Assurant agreed to pay a $14 million penalty and provide restitution to some New York homeowners to settle state allegations of overpriced insurance and excessive profits. New York Gov. Andrew Cuomo said the pact addresses an "intricate web of relationships between insurers and banks" pushing some homeowners into foreclosure.
In an example cited by the state in its announcement last week, New York regulators said J.P. Morgan Chase & Co. "has made approximately $600 million since 2006" through reinsurance transactions with Assurant .
A J.P. Morgan spokeswoman described the bank's arrangement as a "risk-sharing relationship," meaning it profited by taking on some underwriting risk. She said J.P. Morgan receives "no commissions" from Assurant .
"We continue to work with regulators to deliver collateral insurance in the best way possible," said Kevin McKechnie , executive director for the American Bankers Association's office of insurance advocacy. The New York action, he said, "could limit the number of servicers and force smaller institutions out of the business, which would have a negative impact on consumers."
Write to ?Alan Zibel at ?Alan.Zibel@wsj.com and ?Leslie Scism at ?Leslie.Scism@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
03-25-13 2245ET
Copyright (c) 2013 Dow Jones & Company, Inc.
Yeah I saw that.. I was like WTF?!?!
Everyone have their opinion and we have right to outspoken our opinion. If they were ban and that mean you are not listen to your own constitution.
Freddie MAC Accumulating higher than Freddie MAE
BOOM!
Look like this is going 0.0004?
(This story has been posted on The Wall Street Journal Online's Developments Blog at http://blogs.wsj.com/developments.)
By Nick Timiraos
A quirk of Fannie Mae's bailout agreement with the U.S. Treasury could reduce the amount of aid that the government would be able to provide the company if it reports a huge profit for the fourth quarter of 2012.
Fannie Mae said earlier this month that it would delay the filing of its annual report because it hasn't yet determined whether the company is profitable enough to trigger an accounting change that could restore value to some or all of nearly $62 billion in tax benefits that had been written down after the company was taken over by the government four years ago.
Reversing the write-downs of those so-called deferred tax assets would increase Fannie Mae's net worth, the vast majority of which would go to the U.S. Treasury as a dividend payment.
A big increase in Fannie's net worth would also generate a drop in its remaining bailout funds going forward, which would be ironic since the Treasury has repeatedly revamped the agreement to erase any concerns among bondholders that the companies might not have enough money to meet their obligations.
It helps to understand how the federal backstops for Fannie and its smaller sibling Freddie Mac, are structured:
In September 2008 , Fannie and Freddie were placed into conservatorship. The Treasury agreed to inject up to $100 billion in each company so that the firms could function normally until Congress and the White House decided how to revamp them. The Treasury has purchased senior preferred shares in the companies, and in exchange, Fannie and Freddie had to pay to the Treasury dividends of 10% annually on those senior preferred shares.
In February 2009 , the Obama administration increased to $200 billion the total amount of money they'd invest in each company, doubling the $100 billion limit.
In December 2009 , the Obama administration said that for 2010, 2011 and 2012, any money invested into the companies by the Treasury wouldn't count against the $200 billion limit for each company. At the time, Fannie had used up $75 billion in Treasury aid, leaving $125 billion remaining; Freddie had used around $51 billion , leaving $149 billion . The move was made to "leave no uncertainty" about the Treasury's commitment to make sure those companies would meet their obligations to bondholders, the Treasury said at the time.
The Treasury backstops included an interesting wrinkle that's only now getting attention. They said that if Fannie, for example, had a negative net worth at the end of 2012, then it would have the entire $125 billion in unused support available into the future.
But if Fannie had a positive net worth at the end of 2012, then the remaining funding available would be the following: either $125 billion less Fannie's positive net worth at the end of 2012, or $125 billion less the amounts that Fannie had received from the Treasury in 2010, 2011, and 2012, whichever was greater. (Fannie received around $41 billion from the Treasury in that three- year period, meaning Fannie's remaining funding would be reduced by its positive net worth as of December 31, 2012 , up to $41 billion .)
How do the deferred tax assets fit in here? If those deferred tax assets lead to a large boost in Fannie's net worth, then Fannie might have as little as $84 billion left in aid from the Treasury.
(For its part, Freddie Mac , which has already reported its earnings for 2012, saw its $149 billion in remaining aid fall to $140 billion when it reported positive net worth of nearly $9 billion . It said it hadn't yet reached the thresholds needed to reverse the write-downs of its tax credits.)
Of course, if Fannie stays profitable, then it won't need any of that $84 billion . And even if Fannie were to lose more money, it seems unlikely that the company would witness losses of the magnitude of the 2007-11 period. A spokesman for the Treasury Department declined to comment, as did representatives of Fannie Mae and its regulator, the Federal Housing Finance Agency .
Follow Nick @NickTimiraos
-For continuously updated news from The Wall Street Journal , see WSJ.com at http://wsj.com.
(END) Dow Jones Newswires
03-25-13 1311ET
Copyright (c) 2013 Dow Jones & Company, Inc.
(This story has been posted on The Wall Street Journal Online's Developments Blog at http://blogs.wsj.com/developments.)
By Nick Timiraos
A quirk of Fannie Mae's bailout agreement with the U.S. Treasury could reduce the amount of aid that the government would be able to provide the company if it reports a huge profit for the fourth quarter of 2012.
Fannie Mae said earlier this month that it would delay the filing of its annual report because it hasn't yet determined whether the company is profitable enough to trigger an accounting change that could restore value to some or all of nearly $62 billion in tax benefits that had been written down after the company was taken over by the government four years ago.
Reversing the write-downs of those so-called deferred tax assets would increase Fannie Mae's net worth, the vast majority of which would go to the U.S. Treasury as a dividend payment.
A big increase in Fannie's net worth would also generate a drop in its remaining bailout funds going forward, which would be ironic since the Treasury has repeatedly revamped the agreement to erase any concerns among bondholders that the companies might not have enough money to meet their obligations.
It helps to understand how the federal backstops for Fannie and its smaller sibling Freddie Mac, are structured:
In September 2008 , Fannie and Freddie were placed into conservatorship. The Treasury agreed to inject up to $100 billion in each company so that the firms could function normally until Congress and the White House decided how to revamp them. The Treasury has purchased senior preferred shares in the companies, and in exchange, Fannie and Freddie had to pay to the Treasury dividends of 10% annually on those senior preferred shares.
In February 2009 , the Obama administration increased to $200 billion the total amount of money they'd invest in each company, doubling the $100 billion limit.
In December 2009 , the Obama administration said that for 2010, 2011 and 2012, any money invested into the companies by the Treasury wouldn't count against the $200 billion limit for each company. At the time, Fannie had used up $75 billion in Treasury aid, leaving $125 billion remaining; Freddie had used around $51 billion , leaving $149 billion . The move was made to "leave no uncertainty" about the Treasury's commitment to make sure those companies would meet their obligations to bondholders, the Treasury said at the time.
The Treasury backstops included an interesting wrinkle that's only now getting attention. They said that if Fannie, for example, had a negative net worth at the end of 2012, then it would have the entire $125 billion in unused support available into the future.
But if Fannie had a positive net worth at the end of 2012, then the remaining funding available would be the following: either $125 billion less Fannie's positive net worth at the end of 2012, or $125 billion less the amounts that Fannie had received from the Treasury in 2010, 2011, and 2012, whichever was greater. (Fannie received around $41 billion from the Treasury in that three- year period, meaning Fannie's remaining funding would be reduced by its positive net worth as of December 31, 2012 , up to $41 billion .)
How do the deferred tax assets fit in here? If those deferred tax assets lead to a large boost in Fannie's net worth, then Fannie might have as little as $84 billion left in aid from the Treasury.
(For its part, Freddie Mac , which has already reported its earnings for 2012, saw its $149 billion in remaining aid fall to $140 billion when it reported positive net worth of nearly $9 billion . It said it hadn't yet reached the thresholds needed to reverse the write-downs of its tax credits.)
Of course, if Fannie stays profitable, then it won't need any of that $84 billion . And even if Fannie were to lose more money, it seems unlikely that the company would witness losses of the magnitude of the 2007-11 period. A spokesman for the Treasury Department declined to comment, as did representatives of Fannie Mae and its regulator, the Federal Housing Finance Agency .
Follow Nick @NickTimiraos
-For continuously updated news from The Wall Street Journal , see WSJ.com at http://wsj.com.
(END) Dow Jones Newswires
03-25-13 1311ET
Copyright (c) 2013 Dow Jones & Company, Inc.
I saw that too...
The following is a press release from Standard & Poor's :
OVERVIEW
-- We reviewed 100 U.S. RMBS re-REMIC transactions issued between 2002
and 2010.
-- We lowered our ratings on 68 classes, affirmed our ratings on 483
classes, and withdrew our ratings on four classes.
-- Overall increased losses applied to underlying transactions under
multiple rating scenarios, which may have affected underlying securities,
primarily drove the downgrades.
-- We based the affirmations on the adequacy of projected credit support
for the associated classes.
-- This review resolves 68 transactions with ratings initially placed on
CreditWatch in October.
NEW YORK ( Standard & Poor's ) March 25, 2013 -- Standard & Poor's Ratings
Services today lowered its ratings on 68 classes from 21 U.S. residential
mortgage-backed securities (RMBS) resecuritized real estate mortgage
investment conduit (re-REMIC) transactions and removed 50 of them from
CreditWatch with negative implications and one from CreditWatch with
developing implications. We also affirmed our ratings on 483 classes from 91
transactions and removed 288 of them from CreditWatch negative and one from
CreditWatch developing. Furthermore, we withdrew our ratings on four classes
because they were paid in full.
The transactions in this review were issued between 2002 and 2010 and are
supported by underlying RMBS backed by an assortment of different collateral
types including, but not limited to, prime, Alt-A, and subprime mortgage
loans. Subordination, overcollateralization (when available), and applicable
excess interest generally provide credit support for underlying securities of
the re-REMIC transactions. In addition, subordination within the capital
structures of the re-REMICs themselves generally exists in most transactions.
The complete list of rating actions is available in "U.S. RMBS Classes
Affected By The March 25, 2013 , Rating Actions," published today on
RatingsDirect on the Global Credit Portal. The list is also available on the
Standard & Poor's website. On the home page, select ratings, and then choose
rating actions on the left side of the page. From there, find the list on the
press releases tab. For additional information, please visit
"www.standardandpoors.com/rmbs".
On Oct. 26, 2012 , we initially placed our ratings on 2,847 classes from 205
re-REMIC transactions on CreditWatch negative or developing due to the
implementation of our revised criteria (see "2,847 Ratings On 205 RMBS
Re-REMIC Transactions Put On CreditWatch; Revised RMBS Criteria Cited," and
"U.S. RMBS Surveillance Credit and Cash Flow Analysis for Pre-2009
Originations," published Aug. 9, 2012 ). We have completed our review for a
portion of these transactions. The directional movements for the CreditWatch
resolutions within this review are as follows:
Three or fewer More than three
From Watch Affirmations notches notches
Down Down
Watch Neg 288 35 15
Watch Dev 1 1 0
Overall, the CreditWatch resolutions indicated in the table above represent
that most re-REMIC classes may have possessed adequate credit enhancement,
indicating a rating affirmation. However, the revised criteria resulted in a
number of downward rating movements. While most of these downgrades were due
to projected principal writedowns, we attributed roughly 7% of the downgrades
to projected interest shortfalls within the analysis. In addition,
approximately 1% of the downgrades were due to current interest shortfalls in
conjunction with our interest shortfall criteria. In particular, the revised
criteria resulted in additional stress to certain underlying securities, thus
affecting some re-REMIC classes. Such additional stresses include, but are not
limited to, one or more of the following factors:
-- An increase in our loss multiples at higher investment-grade rating
levels;
-- A substantial portion of nondelinquent loans now categorized as
reperforming (many of these underlying loans have been modified) and have a
default frequency from 25% to 50%;
-- Overall increases in roll rates (expected default) for 30- and 60-day
delinquent loans;
-- Application of a high prepayment/front-end stress liquidation scenario
under investment-grade rating scenarios; and
-- An overall continued elevated level of observed loss severities.
For certain transactions, our lowest rating in the re-REMIC may be different
than the lowest rating on an underlying class. We attribute this to the
re-REMIC mechanics (such as additional credit enhancement or rapid pay-down at
the re-REMIC level) or the applied additional stress at the re-REMIC level in
concert with tempered upward rating movement, compared with that of the
underlying security.
With this review, we have resolved the CreditWatch placements for nearly all
of the re-REMIC transactions with ratings initially placed on CreditWatch.
When doing so, we applied our loss projections to the underlying collateral in
order to identify the magnitude of losses that we believe could be passed
through from the underlying securities to the applicable re-REMIC classes. In
addition, we stressed our loss projections at various rating categories to
assess whether the re-REMIC classes could withstand the stressed losses
associated with their ratings, while receiving the appropriate level of due
interest and principal.
We are in the process of reviewing the three transactions remaining from the
initial CreditWatch placements and intend on completing these in subsequent
weeks ahead. For these transactions, we are waiting for clarification from
outside parties and/or we are in the process of evaluating certain structural
mechanics of the re-REMIC.
We affirmed a number of 'CCC (sf)' and 'CC (sf)' re-REMIC ratings based on our
evaluation of the change in overall losses and associated downward rating
movements of underlying securities, combined with our overall view that the
securities lack sufficient credit enhancement compared with our base-case
outlook.
We lowered the ratings on four classes from three re-REMIC transactions to
'AA- (sf)' from 'AA+ (sf)' due to our counterparty criteria. The re-REMIC
classes utilize a swap to convert the Net WAC coupon rate generated by the
underlying classes to a LIBOR plus margin rate promised to the re-REMIC
classes. The swap counterparty for two of the transactions is Deutsche Bank AG
and BNP Paribas is the swap counterparty for another transaction. We rate
Deutsche Bank AG and BNP Paribas 'A+'. While the underlying classes are
insured by Fannie Mae and Freddie Mac , the maximum rating supportable by these
counterparties under our swap counterparty criteria is the counterparty rating
plus one notch, to which we lowered the re-REMIC classes.
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT
SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating
relating to an asset-backed security as defined in the Rule, to include a
description of the representations, warranties and enforcement mechanisms
available to investors and a description of how they differ from the
representations, warranties and enforcement mechanisms in issuances of similar
securities. The Rule applies to in-scope securities initially rated (including
preliminary ratings) on or after Sept. 26, 2011 .
If applicable, the Standard & Poor's 17g-7 Disclosure Report included in this
credit rating report is available at
"http://standardandpoorsdisclosure-17g7.com"
RELATED CRITERIA AND RESEARCH
Related Criteria
-- Counterparty Risk Framework Methodology And Assumptions, Nov. 29, 2012
-- U.S. RMBS Surveillance Credit And Cash Flow Analysis For Pre-2009
Originations, Aug. 9, 2012
-- Criteria Methodology Applied To Fees, Expenses, And Indemnifications,
July 12, 2012
-- Global Investment Criteria For Temporary Investments In Transaction
Accounts, May 31, 2012
-- U.S. Interest Rate Assumptions Revised For May 2012 And Thereafter,
April 30, 2012
-- Methodology For Assessing The Impact Of Interest Shortfalls On U.S.
RMBS, March 28, 2012
-- Principles Of Credit Ratings, Feb. 16, 2011
-- Credit Stability Criteria, May 3, 2010
-- Global Methodology For Rating Interest-Only Securities , April 15, 2010
-- Use Of CreditWatch And Outlooks, Sep. 14, 2009
-- The Interaction Of Bond Insurance And Credit Ratings, Aug. 24, 2009
-- Methodology For the Surveillance Of U.S. RMBS Re-REMIC Transactions,
Dec. 23, 2008
Related Research
-- 2,847 Ratings On 205 RMBS Re-REMIC Transactions Put On CreditWatch;
Revised RMBS Criteria Cited, Oct. 26, 2012
-- 16,872 Ratings From 3,364 U.S. RMBS Pre-2009 Transactions Put On
CreditWatch; Revised Surveillance Criteria Cited, Aug. 15, 2012
-- Global Structured Finance Scenario And Sensitivity Analysis: The
Effects Of The Top Five Macroeconomic Factors, Nov. 4, 2011
Primary Credit Analyst: Mike P Dougherty, New York (1) 212-438-6891;
mike_p_dougherty@standardandpoors.com
Secondary Contact: Jeremy Schneider , New York (1) 212-438-5230;
jeremy_schneider@standardandpoors.com
No content (including ratings, credit-related analyses and data, model,
software, or other application or output therefrom) or any part thereof
(Content) may be modified, reverse engineered, reproduced, or distributed in
any form by any means, or stored in a database or retrieval system, without
the prior written permission of Standard & Poor's Financial Services LLC or
its affiliates (collectively, S&P ). The Content shall not be used for any
unlawful or unauthorized purposes. S&P and any third-party providers, as well
as their directors, officers, shareholders, employees, or agents (collectively
(MORE TO FOLLOW) Dow Jones Newswires
03-25-13 1036ET
The following is a press release from Standard & Poor's :
OVERVIEW
-- We reviewed 100 U.S. RMBS re-REMIC transactions issued between 2002
and 2010.
-- We lowered our ratings on 68 classes, affirmed our ratings on 483
classes, and withdrew our ratings on four classes.
-- Overall increased losses applied to underlying transactions under
multiple rating scenarios, which may have affected underlying securities,
primarily drove the downgrades.
-- We based the affirmations on the adequacy of projected credit support
for the associated classes.
-- This review resolves 68 transactions with ratings initially placed on
CreditWatch in October.
NEW YORK ( Standard & Poor's ) March 25, 2013 -- Standard & Poor's Ratings
Services today lowered its ratings on 68 classes from 21 U.S. residential
mortgage-backed securities (RMBS) resecuritized real estate mortgage
investment conduit (re-REMIC) transactions and removed 50 of them from
CreditWatch with negative implications and one from CreditWatch with
developing implications. We also affirmed our ratings on 483 classes from 91
transactions and removed 288 of them from CreditWatch negative and one from
CreditWatch developing. Furthermore, we withdrew our ratings on four classes
because they were paid in full.
The transactions in this review were issued between 2002 and 2010 and are
supported by underlying RMBS backed by an assortment of different collateral
types including, but not limited to, prime, Alt-A, and subprime mortgage
loans. Subordination, overcollateralization (when available), and applicable
excess interest generally provide credit support for underlying securities of
the re-REMIC transactions. In addition, subordination within the capital
structures of the re-REMICs themselves generally exists in most transactions.
The complete list of rating actions is available in "U.S. RMBS Classes
Affected By The March 25, 2013 , Rating Actions," published today on
RatingsDirect on the Global Credit Portal. The list is also available on the
Standard & Poor's website. On the home page, select ratings, and then choose
rating actions on the left side of the page. From there, find the list on the
press releases tab. For additional information, please visit
"www.standardandpoors.com/rmbs".
On Oct. 26, 2012 , we initially placed our ratings on 2,847 classes from 205
re-REMIC transactions on CreditWatch negative or developing due to the
implementation of our revised criteria (see "2,847 Ratings On 205 RMBS
Re-REMIC Transactions Put On CreditWatch; Revised RMBS Criteria Cited," and
"U.S. RMBS Surveillance Credit and Cash Flow Analysis for Pre-2009
Originations," published Aug. 9, 2012 ). We have completed our review for a
portion of these transactions. The directional movements for the CreditWatch
resolutions within this review are as follows:
Three or fewer More than three
From Watch Affirmations notches notches
Down Down
Watch Neg 288 35 15
Watch Dev 1 1 0
Overall, the CreditWatch resolutions indicated in the table above represent
that most re-REMIC classes may have possessed adequate credit enhancement,
indicating a rating affirmation. However, the revised criteria resulted in a
number of downward rating movements. While most of these downgrades were due
to projected principal writedowns, we attributed roughly 7% of the downgrades
to projected interest shortfalls within the analysis. In addition,
approximately 1% of the downgrades were due to current interest shortfalls in
conjunction with our interest shortfall criteria. In particular, the revised
criteria resulted in additional stress to certain underlying securities, thus
affecting some re-REMIC classes. Such additional stresses include, but are not
limited to, one or more of the following factors:
-- An increase in our loss multiples at higher investment-grade rating
levels;
-- A substantial portion of nondelinquent loans now categorized as
reperforming (many of these underlying loans have been modified) and have a
default frequency from 25% to 50%;
-- Overall increases in roll rates (expected default) for 30- and 60-day
delinquent loans;
-- Application of a high prepayment/front-end stress liquidation scenario
under investment-grade rating scenarios; and
-- An overall continued elevated level of observed loss severities.
For certain transactions, our lowest rating in the re-REMIC may be different
than the lowest rating on an underlying class. We attribute this to the
re-REMIC mechanics (such as additional credit enhancement or rapid pay-down at
the re-REMIC level) or the applied additional stress at the re-REMIC level in
concert with tempered upward rating movement, compared with that of the
underlying security.
With this review, we have resolved the CreditWatch placements for nearly all
of the re-REMIC transactions with ratings initially placed on CreditWatch.
When doing so, we applied our loss projections to the underlying collateral in
order to identify the magnitude of losses that we believe could be passed
through from the underlying securities to the applicable re-REMIC classes. In
addition, we stressed our loss projections at various rating categories to
assess whether the re-REMIC classes could withstand the stressed losses
associated with their ratings, while receiving the appropriate level of due
interest and principal.
We are in the process of reviewing the three transactions remaining from the
initial CreditWatch placements and intend on completing these in subsequent
weeks ahead. For these transactions, we are waiting for clarification from
outside parties and/or we are in the process of evaluating certain structural
mechanics of the re-REMIC.
We affirmed a number of 'CCC (sf)' and 'CC (sf)' re-REMIC ratings based on our
evaluation of the change in overall losses and associated downward rating
movements of underlying securities, combined with our overall view that the
securities lack sufficient credit enhancement compared with our base-case
outlook.
We lowered the ratings on four classes from three re-REMIC transactions to
'AA- (sf)' from 'AA+ (sf)' due to our counterparty criteria. The re-REMIC
classes utilize a swap to convert the Net WAC coupon rate generated by the
underlying classes to a LIBOR plus margin rate promised to the re-REMIC
classes. The swap counterparty for two of the transactions is Deutsche Bank AG
and BNP Paribas is the swap counterparty for another transaction. We rate
Deutsche Bank AG and BNP Paribas 'A+'. While the underlying classes are
insured by Fannie Mae and Freddie Mac , the maximum rating supportable by these
counterparties under our swap counterparty criteria is the counterparty rating
plus one notch, to which we lowered the re-REMIC classes.
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT
SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating
relating to an asset-backed security as defined in the Rule, to include a
description of the representations, warranties and enforcement mechanisms
available to investors and a description of how they differ from the
representations, warranties and enforcement mechanisms in issuances of similar
securities. The Rule applies to in-scope securities initially rated (including
preliminary ratings) on or after Sept. 26, 2011 .
If applicable, the Standard & Poor's 17g-7 Disclosure Report included in this
credit rating report is available at
"http://standardandpoorsdisclosure-17g7.com"
RELATED CRITERIA AND RESEARCH
Related Criteria
-- Counterparty Risk Framework Methodology And Assumptions, Nov. 29, 2012
-- U.S. RMBS Surveillance Credit And Cash Flow Analysis For Pre-2009
Originations, Aug. 9, 2012
-- Criteria Methodology Applied To Fees, Expenses, And Indemnifications,
July 12, 2012
-- Global Investment Criteria For Temporary Investments In Transaction
Accounts, May 31, 2012
-- U.S. Interest Rate Assumptions Revised For May 2012 And Thereafter,
April 30, 2012
-- Methodology For Assessing The Impact Of Interest Shortfalls On U.S.
RMBS, March 28, 2012
-- Principles Of Credit Ratings, Feb. 16, 2011
-- Credit Stability Criteria, May 3, 2010
-- Global Methodology For Rating Interest-Only Securities , April 15, 2010
-- Use Of CreditWatch And Outlooks, Sep. 14, 2009
-- The Interaction Of Bond Insurance And Credit Ratings, Aug. 24, 2009
-- Methodology For the Surveillance Of U.S. RMBS Re-REMIC Transactions,
Dec. 23, 2008
Related Research
-- 2,847 Ratings On 205 RMBS Re-REMIC Transactions Put On CreditWatch;
Revised RMBS Criteria Cited, Oct. 26, 2012
-- 16,872 Ratings From 3,364 U.S. RMBS Pre-2009 Transactions Put On
CreditWatch; Revised Surveillance Criteria Cited, Aug. 15, 2012
-- Global Structured Finance Scenario And Sensitivity Analysis: The
Effects Of The Top Five Macroeconomic Factors, Nov. 4, 2011
Primary Credit Analyst: Mike P Dougherty, New York (1) 212-438-6891;
mike_p_dougherty@standardandpoors.com
Secondary Contact: Jeremy Schneider , New York (1) 212-438-5230;
jeremy_schneider@standardandpoors.com
No content (including ratings, credit-related analyses and data, model,
software, or other application or output therefrom) or any part thereof
(Content) may be modified, reverse engineered, reproduced, or distributed in
any form by any means, or stored in a database or retrieval system, without
the prior written permission of Standard & Poor's Financial Services LLC or
its affiliates (collectively, S&P ). The Content shall not be used for any
unlawful or unauthorized purposes. S&P and any third-party providers, as well
as their directors, officers, shareholders, employees, or agents (collectively
(MORE TO FOLLOW) Dow Jones Newswires
03-25-13 1036ET
NEW YORK, NY -- (Marketwire) -- 03/25/13 -- The Federal Home Loan Mortgage Corporation . (OTCQB: FMCC), Federal National Mortgage Association . (OTCQB: FNMA), Ambac Financial Group, Inc. (OTCQB: ABKFQ), AMR Corporation . (OTCQB: AAMRQ).
The Federal Home Loan Mortgage Corporation . (FMCC) saw shares advancing 0.26% or $0.002 per share to close Friday at $0.782 on volume of 22,051,292 shares traded. The provider of credit guarantees for residential mortgages originated by mortgage lenders and investor in mortgage loans and mortgage-related securities in the United States saw shares rise sharply last week along with other financial firms. Will we see shares continue to rally this week or will investors take profits off the table? Find out our thoughts in our exclusive report at: http://squawkboxstocks.com/reports/FMCC
Federal National Mortgage Association . (FNMA) saw shares advancing 1.65% or $0.0129 per share to close Friday at $0.793 on volume of 54,533,852 shares traded. The secondary mortgage company who securitizes mortgage loans originated by lenders in the primary mortgage market continued to join in on the financial rally last week. It appears that the driving force behind the stocks' big rally was a tax break Fannie Mae -- a.k.a. the Federal National Mortgage Association -- may be taking advantage of. The organization may elect to recognize a more than $60 billion Deferred Tax Asset when it reports its fourth-quarter earnings. The organization said it expects to report "significant net income" thanks to the deferred tax asset, according to its SEC filing. Earnings were scheduled for today, but have been delayed to an unspecified date. Will shares continue to trade higher this week or will we see investors finally looking to secure some profits? Find out our thoughts in our exclusive report at: http://squawkboxstocks.com/reports/FNMA
Ambac Financial Group, Inc. (ABKFQ) saw shares advancing 16.39% or $0.02 per share to close at $0.142 on volume of 20,047,704 shares traded during Friday's trading session. Shares of Ambac Financial Group, Inc. continued their multi day rally & have now gained 255% over the past week. Will shares of Ambac continue to rally or will the stock see profit taking to start the week? Find out our thoughts in our exclusive report at: http://squawkboxstocks.com/reports/ABKFQ
AMR Corporation . (AAMRQ) saw shares decling 4.79% to close Friday's trading session at $4.17 on volume of 7,552,887 shares traded. The stock has been one of the biggest winners so far in March posting gains of 80%. Following such a strong month long rally was the retrace from Friday a sign of further downside ahead? Find out more in our exclusive AAMRQ report at: http://squawkboxstocks.com/reports/AAMRQ
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Yep very much so!
WASHINGTON-- U.S. Senate lawmakers working overnight Saturday moved to curtail the government's ability to use Fannie Mae and Freddie Mac to help pay for other government programs, and targeted Wall Street banks alleged to be "too big to jail."
The $3.7 trillion budget passed a few hours before dawn included a range of amendments offered by lawmakers eager to push pet issues on a piece of legislation that is non-binding and unlikely to become law. While largely symbolic, the amendments highlight lawmaker concerns and issues that could be targeted in other legislation.
Included in the measure were a pair of amendments highlighting a growing belief from some lawmakers that Washington's response to the 2008 financial crisis has been incomplete. The first would limit lawmakers from using fees charged by Fannie Mae and Freddie Mac to offset the cost of spending increases or tax cuts.
Congress has previously used guarantee fees charged by the two firms to help pay for unrelated spending, including in 2011 when the funds were used to help pay for a temporary payroll tax cut.
"I am glad my Senate colleagues recognize the risks of using Fannie Mae and Freddie Mac as piggy banks to finance short-term spending," said Sen. Tim Johnson (D., S.D.), who chairs the Senate Banking Committee .
Lawmakers also approved an amendment offered by Sen. Jeff Merkley (D., Ore.) intended to make clear that all banks, regardless of size, should face criminal prosecution if they commit crimes. The issue of "too-big-to-jail" firms has become a flashpoint on Capitol Hill in the wake of Attorney General Eric Holder's suggestion at a hearing earlier this month that some large Wall Street firms may be too big to prosecute.
"I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them," Mr. Holder told a Senate panel at the March 6 hearing.
That position has sparked outcry from both sides of the aisle, with lawmakers pressuring Obama administration officials from a number of agencies to explain the position. Mr. Merkley said "there should never be a prosecution-free zone."
"Too big to jail is wrong under our Constitution that promises equality under the law and we must end it," he said in a statement.
Such an amendment is unlikely to preclude further congressional inquiry into the question of whether some banks remain too big to face legal repercussions for breaking the law. A key House Republican lawmaker who oversees Wall Street requested additional information from the Federal Reserve, Treasury Department and Office of the Comptroller of the Currency as part of an ongoing investigation into the matter.
Rep. Patrick McHenry (R., N.C.), who chairs an oversight and investigations subcommittee, said in separate letters to the agencies that he wants additional information on the economic analysis used by the Justice Department when it reached a settlement with HSBC Holdings PLC in December over money laundering. Mr. McHenry and Rep. Jeb Hensarling (R., Texas ) previously demanded a range of documents from the Obama administration in relation to the Holder remarks.
- Alan Zibel and Kristina Peterson contributed to this report.
Write to Michael R. Crittenden at Michael.Crittenden@dowjones.com
(END) Dow Jones Newswires
03-23-13 1227ET
Copyright (c) 2013 Dow Jones & Company, Inc.
WASHINGTON-- U.S. Senate lawmakers working overnight Saturday moved to curtail the government's ability to use Fannie Mae and Freddie Mac to help pay for other government programs, and targeted Wall Street banks alleged to be "too big to jail."
The $3.7 trillion budget passed a few hours before dawn included a range of amendments offered by lawmakers eager to push pet issues on a piece of legislation that is non-binding and unlikely to become law. While largely symbolic, the amendments highlight lawmaker concerns and issues that could be targeted in other legislation.
Included in the measure were a pair of amendments highlighting a growing belief from some lawmakers that Washington's response to the 2008 financial crisis has been incomplete. The first would limit lawmakers from using fees charged by Fannie Mae and Freddie Mac to offset the cost of spending increases or tax cuts.
Congress has previously used guarantee fees charged by the two firms to help pay for unrelated spending, including in 2011 when the funds were used to help pay for a temporary payroll tax cut.
"I am glad my Senate colleagues recognize the risks of using Fannie Mae and Freddie Mac as piggy banks to finance short-term spending," said Sen. Tim Johnson (D., S.D.), who chairs the Senate Banking Committee .
Lawmakers also approved an amendment offered by Sen. Jeff Merkley (D., Ore.) intended to make clear that all banks, regardless of size, should face criminal prosecution if they commit crimes. The issue of "too-big-to-jail" firms has become a flashpoint on Capitol Hill in the wake of Attorney General Eric Holder's suggestion at a hearing earlier this month that some large Wall Street firms may be too big to prosecute.
"I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them," Mr. Holder told a Senate panel at the March 6 hearing.
That position has sparked outcry from both sides of the aisle, with lawmakers pressuring Obama administration officials from a number of agencies to explain the position. Mr. Merkley said "there should never be a prosecution-free zone."
"Too big to jail is wrong under our Constitution that promises equality under the law and we must end it," he said in a statement.
Such an amendment is unlikely to preclude further congressional inquiry into the question of whether some banks remain too big to face legal repercussions for breaking the law. A key House Republican lawmaker who oversees Wall Street requested additional information from the Federal Reserve, Treasury Department and Office of the Comptroller of the Currency as part of an ongoing investigation into the matter.
Rep. Patrick McHenry (R., N.C.), who chairs an oversight and investigations subcommittee, said in separate letters to the agencies that he wants additional information on the economic analysis used by the Justice Department when it reached a settlement with HSBC Holdings PLC in December over money laundering. Mr. McHenry and Rep. Jeb Hensarling (R., Texas ) previously demanded a range of documents from the Obama administration in relation to the Holder remarks.
- Alan Zibel and Kristina Peterson contributed to this report.
Write to Michael R. Crittenden at Michael.Crittenden@dowjones.com
(END) Dow Jones Newswires
03-23-13 1227ET
Copyright (c) 2013 Dow Jones & Company, Inc.
This is almost very same as ALGF.. I had a forward split and now it wont trade. They call this a FRAUD! So i have a feeling this is gonna happen to me again.
Feb 21 2013
www.algaefarm.org and the another thing i knew it not a fraud cause why it still trading (ALGAE FUELS PLC) in London, UK trading? http://www.algaefuelsplc.com/
Ive been in this stock for 3 years. That what DTCC said..
Curious.. You buy 7M at what price?
NOPE IT DEAD! IT IS A FRAUD PERIOD.
And one more thing.. I was told by Fidelity that after the payment date (MARCH 31, 2013) my securities value could be ZERO or others, they don't know yet until after the payment date. THAT (BLEEP) UP and I'm little freaking out right now!
21M I think.. You can sell 7 Million now as while wait the payment date, But the problem it depend on which you sell on Limit Order or Market Order. Market Order will put you ahead in the line than limit order.. It depend which number you are in the line.. but sadly there is No Bid.. So that means no one is buying and right now we don't know what the exactly price will be set after the payment date. And im not sure if im correct. It the best DD I could find for myself.. Im still confused about this but all I WANT to get MY DAMN POS SHARES TO GET SOLD TO A IDIOT INVESTOR and then I CAN MOVE on. Once we get the payment day and we all have 2 times more shares to SELL and IM SURE THAT POS will take LONGER for us to sell.. IMO IMO IMO.
You are welcome to correct me.
Enough said: 100% FULL BLOW SCAM
Cheers
Im so screw and Im not gonna fall for anyone HYPE POS THEORY ever again. Lesson learn..
Good Luck
(i know my grammer sucks so excuse me)
but it doesn't matter to us anymore.. It a full blown SCAM. Yes whoever hold or buy shares before or on the date "record date" march 15 2013, that whoever get the dividing which is you'll get 2 shares as for one share you own. It a "forward split". There is no bid and 90% of ihubber are not able to make a sell.. No one is buying. We are stuck like a super glue and pray to god that we hopefully some other pump and dumb will buy it, get out, and move on!
Ohh forgot to add.. The payment date is March 31, 2013
Did you buy or hold the shares as on march 15?
Cause it a scammer! Do more DD and you'll get the answer.. Good Luck
Nah. It will still keep going down.. I HOPE!
Blah Blah Blah.. Dilution, Dilution, and Dilutions
There is more than that.. check this out FOYJ and WGIH,
Ive been in this stock for 1 years.. Finally it waking up!
yeah sure! (Roll my eyes)
Churning: "When a trader places both buy and sell orders at about the same price. The increase in activity is intended to attract additional investors, and increase the price."
March 31, 2013 is the Payment Date which is on Sunday.. On Monday April 1, 2013 is we actually got the Payment but what if it APRIL FOOL?
Wow, So much dilutions!