Fitch: Mortgage REITs' Reliance on Repo Funding Could Increase U.S. MBS Volatility
Jun 27, 2013
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Fitch Ratings-New York-27 June 2013: Given their reliance on repo funding, U.S. agency mortgage REITs (mREITs) and other leveraged investors could face pressures to liquidate some of their MBS holdings if repo lenders were to tighten the terms and availability of funding, according to Fitch Ratings in a new report. Such a deleveraging scenario could in turn create a ripple effect that extends to the broader mortgage markets as a whole.