U.S. Mortgage Bond Issuance Plunged in 1st Quarter

Reuters (04/01/08); Haviv, Julie
A new Thomson Financial survey shows that U.S. mortgage-backed securities (MBS) issuance plunged by more than 75 percent in the first three months of this year from the first quarter of 2007 amid ongoing uncertainty in the housing market. According to the report, MBS issuance totaled $61 billion in this year's first quarter, down substantially from $273.9 billion a year earlier. Richard Peterson, Thomson Financial's director of capital markets, notes that the January-through-March stretch marked the slowest quarter for issuance of U.S. MBS since 2000's fourth quarter. Meanwhile, issuance of bonds backed by firms other than Fannie Mae and Freddie Mac has come to a virtual stand-still as investors opt not to buy securities backed by loans where payments are not guaranteed.