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Fannie Mae prices latest Connecticut Avenue securities risk sharing deal 

August 4, 2016

FTSE Global Markets

Fannie Mae has priced its latest credit risk sharing transaction under its Connecticut Avenue Securities (CAS) series, a $1.2bn note offering scheduled to settle on Wednesday, August 10th. Fannie Mae is using these transactions to help build up the role of private capital in the US mortgage market and, at the same time, help reduce taxpayer risk. This is the 14th deal of its type, bringing the total value of the securities issued to date to around $18.1bn, at the same time transferring a portion of the credit risk to private investors on single-family mortgage loans with an outstanding unpaid principal balance of approximately $621.5bn.

JP Morgan was the lead structuring manager and joint book runner and Wells Fargo Securities was the co-lead manager and joint book runner on the transaction. BNP Paribas Securities Corp., Bank of America Merrill Lynch, Barclays Capital Inc., and Citigroup Global Markers Inc. were co-managers. 

After this transaction is completed, Fannie Mae will have transferred a portion of the credit risk on approximately $741.8bn in single-family mortgages through all of its risk transfer programs. “So far, we’ve had new investors participating in every CAS transaction we’ve issued,” explains Laurel Davis, vice president of credit risk transfer, Fannie Mae. Read more

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