August 25, 2016 Newsletter
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August 25, 2016

Industry Jobs

SFIG Calendar



Advocacy Outlook

Industry News Highlights


On August 22, 2016, SFIG submitted a comment letter to the Consumer Financial Protection Bureau (CFPB) on its proposal for Arbitration Agreements released on May 24, 2016.

The letter sets forth SFIG membership’s concerns regarding changes in the use of mandatory arbitration clauses in credit contracts for various collateral types in securitization transactions, and the impact that the resulting uncertainty will have on ABS market liquidity, and also on the price and availability of credit to U.S. consumers.

SFIG also signed on to a joint-trades comment letter responding to the CFPB proposal. 

To become involved in SFIG’s advocacy on the issues related to the CFPB’s arbitration proposal or related matters, please contact

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Several recent rulings surrounding HOA super priority lien cases in Nevada favored the mortgage industry, as reported by Inside Mortgage Finance.

Daniel Goodwin, Director of Mortgage Policy, told Inside MBS & ABS that SFIG, along with other industry groups, supported the concept of “first in time, first in right” and said that any private lien arising after origination of another private lien shouldn’t take priority over that deed of trust, or have the ability to extinguish it.

Previously, on November 10, 2015, SFIG sent a joint-trade association letter to the federal banking agencies urging them to implement standards or guidelines to prevent HOA super-priority liens from having the capacity to extinguish a prior perfected and recorded mortgage lien.

To participate in SFIG’s Residential Mortgage Committee, please contact

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SFIG Positions

Are you or someone you know eager to join a supportive, hard-working and fun nonprofit team doing incredible work? Good news, SFIG has several openings! Please see the below job opportunities and help us spread the word by passing them along to anyone who might be a good fit:

  • Director of Education: will be responsible for the strategic development and execution of a comprehensive and robust in-person and online education and member development program.
  • RMBS/CMBS Policy Manager: will contribute to the design of, and help execute group-wide strategy efforts and initiatives in support of SFIG’s mortgage policy priorities.
  • Manager of Advocacy: will design and execute advocacy strategies, engage with Capitol Hill and federal regulatory agencies as well as support SFIG’s advocacy efforts through development and growth of its political action committee.
  • Policy Analyst: will support general policy initiatives and investor relations through direct member engagement, meeting facilitation, research and analysis.

You can also follow our Twitter @SFIndustryG at to stay updated on all SFIG job opportunities.

Industry Positions

Some of the latest industry positions available include:

Analyst/Associate Director - Asset Backed Securities Fitch Ratings 07-15-2016
Director/Senior Director - Asset Manager Leader Fitch Ratings 05-03-2016
Director/Senior Director - Research and Criteria Leader Fitch Ratings 05-03-2016

Please visit our Jobs page for a full listing of available positions.

Current members are encouraged to advertise open positions within their company on SFIG's website by filling out the form here.

For questions about positions at SFIG, please contact For questions about the website jobs portal, please contact

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WEDNESDAY, August 31, 2016
2:00 p.m. – 3:00 p.m. (ET)

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WEDNESDAY, August 31, 2016
4:00 p.m. – 5:00 p.m. (ET)

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SUNDAY, September 18, 2016
3:00 p.m. – 5:00 p.m. (ET)
Eden Roc Hotel, Ocean Garden
Miami Beach, FL
Registration available here.

Note: For more information about the Zika virus in Miami, please check the IMN update here.

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SUNDAY, September 18, 2016
12:30 p.m. – 4:30 p.m. (ET)

Please note these special sessions require advanced attendance which may be confirmed with Melissa Igbineweka at

These sessions are closed to the press.

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SUNDAY, September 18, 2016 – TUESDAY, September 20, 2016
The Fontainebleau
Miami Beach, FL
Registration available here.

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SUNDAY, February 26, 2017 - WEDNESDAY, March 1, 2017
Aria Resort & Casino
Las Vegas, NV
Registration available here.

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If you would like to participate in the work SFIG is undertaking through our committees as highlighted below, please e-mail For specific inquiries on any of SFIG’s advocacy efforts, please contact the staff member listed for the related project.

SFIG’s Marketplace Lending Committee was established in August 2015, as an SFIG participant committee and is open to all SFIG members who have a legitimate interest in marketplace lending. The committee was formed with two primary intentions: 1) to work with members involved in marketplace lending to educate the industry as a whole, with a particular focus on the securitization of assets generated through that lending channel; and 2) to determine appropriate securitization-specific policy and engage in related advocacy, leveraging SFIG’s prominence and experience across all asset classes to support the continued responsible growth of securitization in marketplace lending.

The committee recently launched its “Best Practices” initiative to establish industry consensus and provide recommendations around one or multiple accepted approaches. The five established Best Practices work streams are 1) Data & Reporting 2) Representations & Warranties 3) Regulatory 4) Operational Considerations and 5) Enforcement.

The committee previously commented on the Treasury Department's Request for Input on Online Marketplace Lending on September 30, 2015.

SFIG’s Student Loan Committee responded to Fitch’s proposed amendments to FFELP student loan ABS rating methodology earlier this year. The committee also submitted a response to the Proposed Changes to Moody’s Approach to Rating Securities Backed by FFELP Student Loans in October 2015.

To join SFIG’s Student Loan Committee and learn more, please contact

The RMBS 3.0 Task Force released its Third Edition RMBS 3.0 Green Papers in November 2015. The task force has continued its efforts to address key issues specific to private label mortgage securities through work-streams relating to 1) Representations, Warranties, and Repurchase Enforcement; 2) Due Diligence, Data, and Loan-Level Disclosure; 3) Role of Transaction Parties; and 4) Bondholder Communications. We encourage members to participate in any or all of the working groups to contribute towards the mission of RMBS 3.0. For its 2016 agenda, the task force will address topics including the inclusion of an independent Deal Agent in transactions, Bondholder Communications, Data and Loan-Level Disclosure, Repurchase Enforcement, and Settlements, as well as undertake a review of the previously published Green Papers.

For additional information on RMBS 3.0, please contact

In response to a request for public comment issued by FHFA on the GSEs’ credit risk transfer processes, SFIG, through its GSE Reform Task Force, convened a call on July 7th to gauge membership’s interest. The task force is currently working on a response to be submitted no later than October 13, 2016.

To join SFIG’s GSE Reform Task Force and learn more, please contact

The Mortgage Loan Level Disclosure Task Force will soon begin its review of the Mortgage Industry Standards Maintenance Organization’s (MISMO) work to map the data elements that lenders should deliver in securitizations per the recent Regulation AB II release of Schedule AL. The requirements will come into effect in November 2016, and SFIG has participated in weekly conference calls with MISMO for the last 18 months in an effort to standardize disclosure by that time. SFIG encourages subject-matter experts from member organizations to participate in its review—which will be conducted jointly by this task force and the RMBS 3.0 Due Diligence, Data and Disclosure Working Group—so the work can be adopted as an industry-wide standard.

Members interested in participating should contact

The Volcker Task Force has been working with SFIG’s various asset class and legal counsel committees to identify areas within the Volcker Rule in need of clarification, particularly questions regarding covered funds and the loan securitization exemption.

Please contact to participate on the Task Force.

The Risk Retention Industry Guide Working Group launched its interim Industry Guide, ahead of the RMBS compliance date, focused on issues either relevant to all asset classes or specific to RMBS. The Working Group continues to work on a final guide focused on creating best practices and developing consensus positions around several areas within the Credit Risk Retention final rule.

Please contact with any questions.

SFIG’s Chinese Market Committee completed their White Paper, A Comprehensive Guide to U.S. Securitization, in April for Chinese regulators and the Chinese Securitization Forum to educate them on the U.S. securitization landscape. The committee also continues to hold discussions with a focus on SFIG’s partnership with the CSF, potential upcoming educational discussions and the sharing of recent market developments in China.

If you would like more information on SFIG’s work with respect to Chinese securitization, please contact

The Regulation AB II Task Force has been focused on the disclosure and offering process requirements within the final rule. Asset specific work streams have been formed to develop comment letters on the outstanding proposals within the final rule and the Task Force submitted the first part of its comment letter in June of 2015. SFIG submitted a supplemental comment letter covering credit card and equipment floorplan asset classes on January 12, 2016 and another supplemental comment letter regarding asset-level information for student loans on June 15, 2016.  Future discussions across asset class committees and the Regulation AB II Task Force will focus on the remaining outstanding proposed rules, including potentially requiring issuers to provide the same disclosure for Rule 144A offerings as required for registered offerings.

SFIG members who are interested in joining this task force or asset specific committees should contact

The Regulatory Capital and Liquidity Committee recently submitted a response to the U.S. proposed net stable funding ratio (NSFR) requirements. The committee also recently submitted comments to the Federal Reserve Board’s (FRB) proposal regarding Single-Counterparty Credit Limits, and before that, submitted a response to Basel’s Consultative Document regarding Capital Treatment for STC Securitisations. The committee will be addressing industry concerns related to the FRB’s Final Rule on the Liquidity Coverage Ratio (LCR). SFIG testified before Congress in February 2016, focusing on global regulatory issues, including LCR, that affect lending across all asset classes.

To become involved in SFIG’s advocacy on the final LCR or NSFR rules, please contact

The Derivatives in Securitization Task Force obtained no-action relief from the CFTC giving swap dealers comfort that the CFTC would not take enforcement action against swap dealers that did not comply with certain CFTC Regulations when taking actions in response to the credit ratings downgrade of a counterparty to a legacy swap. The relief applies to swaps with SPVs that were in existence prior to October 10, 2013. The task force also commented on the CFTC’s proposal on margin requirements for uncleared swaps, as well as the prudential regulators’ proposal regarding margin and capital requirements for covered swap entities. In October 2015, the prudential regulators approved a Joint Final Rule on Swap Margin Requirements. In November 2015, the CFTC issued their final rule regarding margin requirements for uncleared swaps for swap dealers and major swap participants.

The High Quality Securitization (HQS) Task Force submitted a response to Basel’s Consultative Document regarding Capital Treatment for STC Securitisations in February 2016. The task force previously responded to the European Commission’s consultation on an EU framework for simple, transparent and standardized securitization on May 12, 2015. The task force also previously responded to the BCBS-IOSCO consultation on its criteria for identifying simple, transparent and comparable securitizations. SFIG’s comments were built off of those sent to the European Banking Authority on January 14th (available here) regarding its proposed criteria and to the European Central Bank and Bank of England last summer (available here) regarding the development of a sustainable securitization market in Europe. SFIG testified before Congress in February 2016, focusing on global regulatory issues, including HQS, which affect lending across all asset classes.

To join the HQS Task Force, please contact

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As of Tuesday August 23rd, the Consumer Financial Protection Bureau (CFPB) was “flooded with nearly 13,000 public comments” to its proposal that would limit the use of mandatory arbitration clauses in consumer credit contracts, the Wall Street Journal reports. The large number of responses indicates a “rough road ahead” for the CFPB as it moves to the comment review process for the proposed regulation. Responses came in opposing and supporting the proposal, which “would make it easier for consumers to sue banks over a wide range of products from credit cards and bank accounts to private student loans.”

The rule, which was proposed in May, would “prohibit financial companies from using mandatory arbitration clauses as a way to block class-action lawsuits,” but “[c]ompanies would still be able to require consumers to enter arbitration to resolve individual disputes.” The article points out that lawmakers have also voiced their opinions on the proposed rule, and that over “100 congressional Democrats signed letters supporting the rule in early August.” In opposition, “the House appropriations bill for the fiscal year that starts Oct. 1 included a Republican-backed provision to ban CFPB funding for regulating arbitration agreements.”

SFIG submitted a comment letter outlining our members’ concerns about the negative impact that limiting the use of arbitration clauses would have on the securitization market, due to uncertainty created for the consumer credit assets underlying structured transactions. If you are interested in SFIG’s advocacy on the CFPB’s arbitration proposal or related matters, please contact

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On Sunday, August 21st, Federal Reserve Vice Chair Stanley Fischer noted that the Fed was close to hitting its targets of 2 percent inflation and full employment, indicating a greater likelihood that the Fed’s Board of Governors would choose to raise interest rates before the end of 2016.

During comments made at the "Program on the World Economy" conference in Aspen, Colorado, Fischer painted a positive picture of the economy. He labeled the labor market as “remarkably resilient” and inflation measured by the U.S. personal consumption expenditures price index as “within hailing distance” of the 2 percent target. Fischer’s comments followed a statement by New York Fed President William Dudley made last week that a rate hike could be announced as early as the Fed’s next policy meeting in September.

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A number of fintech sub-segments, including blockchain, InsurTech and robo-advisors, have gained significant traction during Q2 '16, according to the Pulse of Fintech, the quarterly global report on fintech VC trends published jointly by KPMG International and CB Insights. Blockchain in particular was among the big winners, and will continue to gain momentum, the firms predict.

During Q2’16, interest in blockchain technology has risen significantly as a number of banks and financial institutions from around the world started focusing on proof-of-concept initiatives, moving from initial ideas to pilot testing of solutions. Several large Q2 funding rounds also went to blockchain focused companies.

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On Thursday, August 18th, Wells Fargo, Bank of America, and Morgan Stanley sponsored an $870.6 million transaction in the CMBS market. An American Banker article highlighted how the recent deal may provide large financial institutions with preferable capital treatment, the first of its type to comply with the new risk retention rules. The three banks’ exposure to the deal – collectively, 5 percent of the underlying assets, which amounts to $43.5 million – was “well received by investors.”

Though the final risk retention rule – a joint rule required under the Dodd-Frank Act - is not active until December 24th, the participating firms are “expected to take advantage” of concessions “unique to the CMBS market, allowing sponsors to satisfy the rules” by selling the risk to third parties.

Further, because this risk retention approach is unique to the CMBS market, “the pools were conservatively written,” according to the article. Peter McKee of Alston & Bird, in referencing the deal, said “It appears the deal priced so favorably that there should be [a] price advantage, going forward.”

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The asset-management arms of Goldman Sachs and Prudential Financial have turned to asset backed securities in a search for investments with high yields and relatively low risk. According to a recent article in Bloomberg, money managers at both firms have begun investing in assets backed by “consumer...debt like mortgages and student loans” with the understanding that their performance is not directly tied to U.S. corporate profits. This factor has made such securities an attractive investment given the current state of global economic uncertainty.

The article notes that the firms have begun investing in these types of securities as an alternative to high-yield corporate notes because they share comparable credit ratings but often offer higher returns. Prudential Fixed Income’s John Vibert, co-head of structured products, is quoted as saying AAA rated bonds backed by commercial mortgages are “a surrogate for traditional high quality fixed-income bonds.” These moves come as indicators like a low unemployment level and an eight year high in new home sales suggest that consumer demand will remain strong.

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SFIG has a number of Committees and Task Forces meeting and working on many topics of interest to the securitization industry. Please email us for more information, including how to join.

SFIG is pleased to share this edition of its newsletter with our members, as well as our supporters in the structured finance community. To ensure that you receive future editions of the newsletter, please visit our website or email us to learn more about membership opportunities.

Contact Information

Richard Johns Executive Director

Kristi Leo Investor Relations

Sairah Burki Senior Director, ABS Policy

Dan Goodwin Director, Mortgage Policy

Tom McCrocklin Director, Advocacy

Jennifer Wolfe Manager, ABS Policy

Hua Liu Communications & Social Media Manager

Alyssa Acevedo Senior Analyst, ABS Policy

Marshall Bornemann, Policy Analyst

Robert Robilliard, Data and Policy Analyst

Jennifer Serpas Office Manager

Sarah Clarke Events Coordinator

Dani Hernandez Executive Administration

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