Sector developments and company hires

GSE results improve
Both Fannie Mae and Freddie Mac have reported sharply improved Q2 results, despite the ongoing housing market dislocation as a result of Covid-19. Fannie Mae said net comprehensive income was US$2.53bn, compared to US$476m in Q1, while Freddie Mac had income of US$1.94bn compared to US$620m in Q1. Both GSEs had much lower than usual profits in Q1 as loan loss allowances were increased dramatically to reflect the expected impact of the pandemic.

Fannie Mae added that 972,000 of its borrowers were in forbearance plans at the end of June, representing 5.7% of its single-family business. Only 1.2% multi-family loans are in forbearance. It says it will extend the moratorium on foreclosures until the end of August at the earliest.

In other news…

CLO management transferred
The investment management agreement for B&M CLO 2014-1 has been transferred from Tortoise Credit Strategies (TCS) to R Squared BM, doing business as Ducenta Squared Asset Management (DSAM). The move follows DSAM’s acquisition of TCS – whose predecessor was Bradford & Marzec - in April. Senior TCS professionals received equity stakes in DSAM as part of the agreement. Jeffrey Brothers, who joined Bradford & Marzec in 1994, was named co-head of fixed income and senior portfolio manager - head of structured products.

Analytics solution selected
The FHFA has selected RiskSpan’s cloud platform, Edge, to analyse agency MBS issued by Fannie Mae and Freddie Mac. Edge hosts and manages approximately 13 billion loan records and 3.5 million securities – with securities performance history dating back over 20 years. The cloud solution connects RiskSpan clients with loan-level collateral backing agency MBS, CMOs, non-agency RMBS and ABS.