trending Market Intelligence /marketintelligence/en/news-insights/trending/kdv9bjidqtj9qedubw8yyw2 content esgSubNav
Log in to other products

Login to Market Intelligence Platform

 /


Looking for more?

Contact Us
In This List

Fannie Mae completes credit insurance risk transfer transaction

Blog

Banking Essentials Newsletter, January edition - part 2

Banking Essentials Newsletter December Edition Part 2

Banking Essentials Newsletter - November Edition

University Essentials | COVID-19 Economic Outlook in Banking: Rates and Long-Term Expectations: Q&A with the Experts


Fannie Mae completes credit insurance risk transfer transaction

Fannie Mae has completed a credit insurance risk transfer transaction, its first in 2018, which covers $16.9 billion of single-family loans.

The transaction, which became effective Feb. 1, is a part of Fannie Mae's ongoing effort to reduce taxpayer risk by increasing the role of private capital in the mortgage market. With this transaction, the company will retain risk for the first 50 basis points of loss on a $16.9 billion pool of loans. If the $84.4 million retention layer is exhausted, reinsurers will cover the next 275 basis points of loss on the pool, up to a maximum coverage of approximately $464.1 million.

Coverage for these deals will be provided based upon actual losses for a term of 10 years and may be canceled by Fannie Mae at any time on or after the fifth anniversary of the effective date by paying a cancellation fee.