Tag Archives: FBR Capital Markets

Investment bank FBR's third-quarter mortgage originations estimate is $349 billion, a 29 percent decline over the quarter. The abating refinance market is a major drag on the mortgage industry, and, "[w]e do not believe that there will be a strong enough increase in the purchase market this quarter to offset the loss in refi volume," FBR stated. FBR estimates a 46 percent decline in refinances in the third quarter and a 2 percent rise in purchase originations.

While FBR Capital Markets says its predictions for origination volume are still "attainable," the company admits its estimates "depend on a stable rate environment or a more robust level of economic activity."

In a commentary released Tuesday, analysts at FBR Capital Markets pointed to market trends and recent events as evidence that origination volumes should remain elevated.

After recently reporting predictions of declining originations, FBR Capital Markets & Co., now says the market looks a little brighter, and a resurgence of refinances through the Home Affordable Refinance Program (HARP) will contribute to originations volumes this year. While FBR maintains its prediction that origination volume will be lower than the volumes recorded in the second half of last year, the company now suggests originations "will largely be better than the 20-25 percent drop-off we projected late last week."

While the Mortgage Bankers Association (MBA) estimates about $482 billion of originations in Q1, FBR--citing comments from industry contacts--believes first-quarter volume to be closer to $400 billion, a drop of nearly 25 percent from the $525 billion of originations in Q4 2012. Though the year may have started slow, the investment banking advisory firm attributes the drop-off in activity to seasonal slowdown and forecasts growth throughout 2013 as low rates and government expansion efforts keep up interest in refinances.

And then there were five. Republican presidential hopeful and former Utah Gov. Jon Huntsman threw his support Monday behind frontrunner and former Massachusetts Gov. Mitt Romney. Not unlike his fellow candidates ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô or the incumbent himself ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô Huntsman left out any mention of housing finance reform and homeowners as issues for voters in the 2012 general election. Recent polls suggest that the political will exists to make housing finance policy a platform issue. MReport speaks with the experts to better understand housing finance policy and politics.

An executive shake-up is underway at PHH Corp. The company's president and CEO, Jerome Selitto, recently announced his resignation, and simultaneously, PHH moved to appoint Glen Messina to the position. Messina, who has acted as PHH├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós chief operating officer since July 20ll, has previously been the chief financial officer and CEO for the mortgage division of General Electric Co. The personnel swap follows negative ratings and estimates for PHH; the company's stock has dropped by 25 percent during the past month and is down 45 percent from numbers seen six months ago.

Smaller mortgage originators are stepping up to the plate to make loans as larger lenders - encumbered by mounting litigation and repurchase claims - pull back from the servicing sector, according to a report released Thursday. Paul Miller, a financial analyst with FBR Capital Markets, based conclusions from the report on quarterly shares of market activity. He credited the retreat by larger lenders for reasons why rivals more than doubled their respective footprints in the mortgage market by the third quarter this year.

The Federal Housing Administration submitted an annual actuarial report to Congress Tuesday that suggests diminishing returns from a fledgling growth strategy could lead the agency to a taxpayer-funded bailout next year. The reason why? The FHA currently fails to meet a 2-percent capital reserve ratio mandated by federal law, with cash reserves on hand falling to less than an eighth below the required threshold. The report said that cash reserves on hand fell accordingly from $4.7 billion last year to $2.6 billion over 2011. Estimates predict that it could require $50 billion.