January 10, 2019 | Issue 266
SFIG Welcomes 116th Congress
On Thursday, January 3, SFIG staff visited Members of Congress at a number of open houses on the first day of the 116 th Congress. Speaking directly to Members and congressional staff, SFIG kick-started its 2019 advocacy agenda by discussing GSE Reform, fixes to the QM Patch and the False Claims Act, and other policy priorities. If you would like to participate in our advocacy efforts, join our Government Relations Committee, or become directly involved by joining the Structured Finance Coalition, please contact Leslie.Sack@sfindustry.org
SFIG Participates in ARRC Fallback Consultation Webinar
On Monday, January 7, Sairah Burki, SFIG’s Head of ABS Policy, and Lisa Pendergast, CREFC’s Executive Director, participated in the ARRC Fallback Consultation: Securitizations Webinar. During the webinar, they reviewed the recently released consultation on USD LIBOR fallback contract language for securitizations to help market participants understand and respond to the request for feedback during the comment period.

The consultation was developed by the Securitizations Working Group of the Alternative Reference Rates Committee (ARRC), representing the collective work of more than 60 institutions and approved by the ARRC. The consultation outlines draft language for new contracts that reference LIBOR so as to ensure these contracts will continue to be effective in the event that LIBOR is no longer usable.

Click here to access the webinar recording. 
Industry News
S&P: 2019 Outlook for Global Structured Finance
According to a recent S&P webinar, the expected global issuance for 2019 will likely exceed $1 trillion. Potential factors that could affect the structure d finance global recovery include renegotiation of trade agreements, Brexit uncertainty, rising interest rates, and any market volatility that affects liquidity. Despite these risks, structured finance markets are unlikely to suffer a large setback over the course of 2019, S&P states.
Servicers Implement Natural Disaster Policies During Shutdown
With the government indefinitely shutdown, servicers are implementing response plans normally used for hurricanes and wildfires as federal workers labor without pay. While Fannie Mae and Freddie Mac are offering paycheck loan assistance, some credit unions are providing zero percent APR loans for impacted members, and other lenders are offering forbearance.
Government Shutdown Likely to Slow Mortgage Originations
With many government employees furloughed, agency mortgage originations are poised to slow, according to a piece in Asset Securitization Report . Some government lenders like the USDA Rural Housing department have not committed to allow lenders to close applications for financing. The Federal Housing Administration (FHA) will be particularly impacted due to a reduced workforce, loan backlogs, lender reliance on automated underwriting, a lack of access to IRS income verification, and lower consumer confidence. The article specifically notes that of the 2,386 employees at the HUD Office of Housing, only 103 of those workers are still in the office. Additionally, the IRS is unable to issue Form 4506-T, which provides certification of income verification and tax return transcripts, slowing or halting some originator's processes. 
Fed Challenged to Keep Inflation Contained and Avoid a Recession
The Federal Reserve faces a new test in 2019, engineering an economic soft landing following its navigation through the financial crisis and rebound, according to The Wall Street Journal . The Federal Reserve’s main challenge is to manage a moderation in growth that keeps inflation contained but avoids a recession. The industry will be looking to remarks by the Federal Reserve Chairman and Vice Chairman this week for clues on officials’ thinking.
Non-Conforming MBS Issuance Doubles in 2018
Newly issued non-agency MBS totaled $29.08 billion in 2018, representing a 94.3 percent increase year-over-year, according to Inside Mortgage Finance . Both prime and expanded credit deals reached post-crisis highs, with prime non-agency issuance reaching $17.69 billion. 
SFIG Look Ahead
RMBS 3.0 Enforcement Workstream (DISCOVERY)
Wednesday, January 16
10:00 a.m. – 11:00 a.m. EDT
Force Call
Wednesday, January 16
4:00 p.m. – 5:00 p.m. EDT 
GSE Reform Task
Force Call
Thursday, January 17
2:00 p.m. – 3:00 p.m. EDT 
RMBS 3.0 Enforcement Workstream (REPORTING)
Thursday, January 17
3:00 p.m. – 4:00 p.m. EDT
SFIG Events
Technology Demos: Hosted by the Chamber of Digital Commerce
SFIG is pleased to announce that the Chamber of Digital Commerce is partnering with SFIG to develop content on Wednesday, February 27 during SFIG Vegas 2019. Wednesday morning’s sessions will focus on blockchain, cybersecurity, and technological innovation, with concurrent live technology demonstrations available to all attendees. Topics include:

  1. Blockchain Fundamentals: A Non-Technical Overview
  2. Applying Blockchain in Securitization: Opportunities for Reinvention
  3. Blockchain Trends: From ICOs to STOs and Beyond

If your firm is interested in hosting a technology demonstration, please email SFIGVegas@sfindustry.org for more information.
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SFIG Vegas 2019: Keynote Speakers and Agenda Announced
The SFIG Vegas 2019 agenda is available ! The SFIG Vegas 2019 conference is designed to encourage dialogue between all participants in the securitization industry. Click here to register for this highly anticipated event.

We would like to extend a special thank you to our  sponsors  for their support.