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Investments

Shellpoint springs into private-label RMBS issuance

Specialty finance firm Shellpoint Partners says the U.S. Securities and Exchange Commission approved a registration filing that will allow the company to issue private-label residential mortgage-backed securities.

The step allows the firm to sell as much as $2 billion of RMBS, without government backing, the company added.

"We intend to be a significant issuer of new issue RMBS and help define the new market standards and practices that will restore a healthy housing market as one of the vital cornerstones of the economy," said Saul Sanders, co-CEO of Shellpoint.

He added, "Funding the shelf with substantial capacity shows our commitment to bringing urgently needed private capital back into the housing market."

Shellpoint’s RMBS would be backed by loans made or brought by New Penn Financial, according to the statement.

As a prospective RMBS issuer and industry participant, Shellpoint is also committed to helping define the new market standards and practices that will support the growth of a healthy and responsible RMBS market.

The company is among a handful of issuers including Redwood Trust, PennyMac Mortgage Investment and JPMorgan Chase (RMBS) that are starting to benefit from the thawing sales of nonagency mortgage bonds.

Issuance has been tied to roughly $5 billion of new jumbo loans, compared with $3.5 billion in all of last year, according to market experts.

Redwood and Credit Suisse (CS) have been the dominating issuers in the market where sales reached as high as $1.2 trillion in the heyday of the market of 2006 and 2007. 

Other issuers include EverBank Financial Corp and with investment firms such as Two Harbors Investment wanting in on the private-label RMBS market.

cmlynski@housingwire.com

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