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Puerto Rico 2017 MBA Conference

Ginnie Mae:Program Overview and Insights

• In 1968, Congress established the GovernmentNational Mortgage Association, known as “GinnieMae.”

• Ginnie Mae is a government-owned corporationorganized within HUD. Its President is nominatedby the President of the United States andconfirmed by the United States Senate.

• Ginnie Mae’s mission is to expand affordablehousing in America by linking global capitalmarkets to the nation's housing markets.

• Ginnie Mae securities are the only mortgage-backed securities that offer the full faith andcredit guaranty of the United States Government.

• Ginnie Mae’s role is to guarantee timely principaland interest payments to investors, and it chargesguaranty fees for this commitment.

• Ginnie Mae realized $305.8 million of net profit forthe U.S. Government in FY 2016.

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About Ginnie Mae

• Ginnie Mae has guaranteed over $3.3 trillion in MBS since the onset of thecredit crisis.

• Ginnie Mae has continued in this role during the past year by providingguarantees on $490 billion in securities, representing nearly 2.1 millionhouseholds across the country.

• Ginnie Mae implemented key programoperational and managementinitiatives to strengthen productofferings, improve reporting anddisclosure for customers and themarket.

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Key Achievements in Fiscal Year 2016 (Oct. 2015 to Sept. 2016)

1,247 1,225

2,0982,586

2,874

0

1,000

2,000

3,000

4,000

2012* 2013* 2014 2015 2016

Reve

nues

(Mill

ions

)

Fiscal Year

Ginnie Mae Total Revenues FY 2012 to FY 2016

Program Income and Other RevenueInterest Income - U.S. Government Securities

• Since March 2010, Ginnie Mae MBS grew 90% to over $1.7 trillion, incontrast to Fannie Mae and Freddie Mac whose growth was largely steady,helping to finance affordable and community-stabilizing single familyhousing across the nation.

• The Ginnie Mae single family portfolio is diverse and has provided stabilityto the MBS markets with:

o the securitization of loans for first time home buyers and borrowers withlower credit scores that qualify for agency loans.

o the refinancing of existing FHA, VA, RD, PIH, or conventionally financedproperties.

• In CY 2016, Ginnie Mae’s single family MBS portfolio increased to $1.61trillion, compared to $1.53 trillion in December 2015, and helped financenearly 2.1 million new households.

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Single Family Program Highlights

Ginnie Mae’s relevance is evidenced in its steady, increased growth and its share of the secondary mortgage market.

Pumping new money into economy.

0.06% guaranty fee – unchanged

2.1 million people have benefitted in FY 2016 alone

2017 YTD issuance is comprised of 60% purchase, 34% refinance, and 6% modification volume

Ginnie Mae Provides a Single Security and a Reliable Platform that Levels the Playing Field

Approved Issuers

Outstanding Ginnie Mae Securities; over 10 million loans

$1.8 Trillion

P & I Paid to Investors Monthly

$490 billion of MBS in FY 2016; 35 percent of market.

Current Staffing Level

5

Average Monthly Issuance for 2017 YTD

143

$42Billion

434

$490Billion

$29 Billion

Ginnie Mae MBS Outstanding Surges, Post Financial Crisis42 Years to Reach $1 Trillion then to $1.8 Trillion in Seven Years

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$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

$2,000

Single Family RPB Multifamily RPB HMBS Total Program RPB

Historic trend of growth2007-2017

$ (Billion)

Apr-17$1.82 trillion

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Composition of Ginnie Mae MBS Issuance Volume

Ginnie Mae Issuers are responsible for servicing the securities & the loans backing them; in the case an original Issuer sells servicing to another entity, the new entity takes on all obligations of the original Issuer.

75%

25%

FY 2012Depositories Non-Depositories

FY2012 SF Issuance Volume: $360B

29%

71%

FY 2017 YTD*Depositories Non-Depositories

FY2017 YTD* SF Issuance Volume: $278B*YTD through April

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Vs. Puerto Rico

21

128,886

$12.7

$0.44

$98,164

74%

5.5 Years

Ginnie Mae

Active Issuers 317

Pooled Mortgages 10,419,128

Portfolio RPB ($B) $1,664.8

CYTD Issuance ($B) $133

Average Loan Size $159,785

Ginnie I Concentration 12%

Average Loan Age 3.5 Years8

Single Family Ginnie Mae to Puerto Rico Comparison

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Vs. Puerto Rico

94%

Ginnie Mae

Depository Percentage 49%

Loan Profile

Agency Profile

52%42%

3% 3%

59%

35%

3% 3%0%

20%

40%

60%

80%

Purchase Refi HAMP Non-HAMP

74%

8%18%

0%

67%

25%

8%0%

0%

20%

40%

60%

80%

FHA VA RD PIH

Puerto Rico Ginnie Mae

Single Family Ginnie Mae to Puerto Rico MBS Comparison

Vs. Puerto Rico

4.39%

Ginnie Mae

Average MortgageRate 3.98%

Mortgage Rate Distribution

42%

21%

9%7% 5% 5% 5% 5%

1%

57%

19%

10%

6%3% 2% 1% 1% 0%

0%

10%

20%

30%

40%

50%

60%

<= 4 <= 4.5 <= 5 <= 5.5 <= 6 <= 6.5 <= 7 <= 8 8 <

Puerto Rico Ginnie Mae

Single Family Ginnie Mae to Puerto Rico MBS Comparison

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Puerto Rico Single Family Loan Count By Zip Code

1-35 581-138536-118 119-580 >1385

Caguas

San Juan

Ponce

BayamónCarolina

Mayagüez

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Single Family Ginnie Mae Issuers with Loans in Puerto Rico As of April 2017

# Issuer ID Name

Loans Located in

PRRPB in State % of Issuer

RPB

1 3842 BANCO POPULAR DE PUERTO RICO 58,957 $5,536,785,715 100.0%2 4344 BANCO POPULAR DE PUERTO RICO - (ACQUIRED FROM DORAL) 27,891 $2,205,328,319 100.0%3 3982 SCOTIABANK DE PUERTO RICO 15,667 $1,820,049,763 100.0%4 2217 FIRSTBANK PUERTO RICO 13,250 $1,511,874,458 98.1%5 3963 ORIENTAL BANK 3,039 $373,721,513 100.0%6 3940 EMI EQUITY MORTGAGE, INC. 2,625 $300,848,122 100.0%7 3365 BANCO SANTANDER PUERTO RICO 2,268 $275,964,831 100.0%8 4324 THE MONEY HOUSE, INC. 2,278 $248,826,425 100.0%9 All Other Issuers 2,911 $378,528,993 0.3%

128,886 $12,651,928,139Single Family Loans and RPB Located in PR

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0.0%0.1%0.2%0.3%0.4%0.5%0.6%0.7%0.8%0.9%1.0%

$0

$50

$100

$150

$200

$250

$300

% o

f Tot

al G

inni

e M

ae O

PB

OPB

($M

)

OPB of PR % of Ginnie Mae OPB

Puerto Rico OPB and % of Ginnie Mae Issues

Puerto Rico Ginnie Mae

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Vs. Puerto RicoGinnie Mae

Credit Score Profile

LTV Profile

Puerto Rico Ginnie Mae

9%18%

67%

5%9%19%

71%

1%0%

20%

40%

60%

80%

76-85 86-95 96-105 106-115

7%0% 2% 4%

15%

32%39%

9%

0% 2%5%

22%

36%

26%

0%

10%

20%

30%

40%

50%

Single Family Ginnie Mae to Puerto Rico Comparison (2017 FYTD)

Puerto Rico Ginnie Mae

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Vs. Puerto RicoGinnie Mae

DQ3+ Trend

Delinquencies and Foreclosures

Puerto Rico Ginnie Mae

4.98%

1.86%

2.85%

1.52%

3.07%

0.80% 0.84%0.37%

0%1%2%3%4%5%6%

DQ1 Only DQ2 Only DQ3+ Foreclosure

Single Family Ginnie Mae to Puerto Rico Comparison

0%1%2%3%4%5%6%

Puerto Rico Loss Mitigation Engagement

308 301

694

338

179

0

100

200

300

400

500

600

700

800

2013 2014 2015 2016 2017 YTD

Loss Mitigations

Loan Count

• Loss mitigation activity remains low after a temporary spike in 2015.

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Top 10 Most Common Puerto Rico Issuer FindingsMost Common Findings (Reviews Starting between 9/2/2014 and 5/1/2017)

Finding Description Guidance

250001 Loan(s) found where the liquidation code used was not correct on the Form HUD-11710E.

All Participant Memorandum (APM)

02-17

510108 Issuer does not make full and timely MIP payments as required per Agency. HUD Handbook 4330.1

400721 Loan(s) found which are ineligible for Agency benefits that have not been repurchased from the pool(s).

Ginnie Mae MBS Guide Section 14-8

400606For delinquent loans that have been referred for foreclosure, the process has exceeded FHA's allotted time requirements for that state and no extensions have been requested or granted.

HUD Handbook 4330.1

400711 Loan(s) found in pool(s) which do not match Agency endorsement database.All Participant

Memorandum (APM) 02-17

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Top 10 Most Common Puerto Rico Issuer Findings (cont.)Most Common Findings (Reviews Starting between 9/2/2014 and 5/1/2017)

Finding Description Guidance

510230 Issuer cannot provide evidence of timely Suspended item promotion. Ginnie Mae MBS Guide Appendix VI-19

400709 Loan(s) found in pool(s) which have incorrect case numbers reported to Ginnie Mae.

Ginnie Mae MBS Guide Appendix V-1

510197 Escrow amounts reserved for borrower were not funded into the appropriate custodial account at time of securitization and/or pool transfer date.

Ginnie Mae MBS Guide Section 16-5

400470 Information on the MIC/LGC/LNG does not agree to internal records.All Participants

Memorandum (APM) 02-17

400303 Account title of 203(k) Special Escrow Custodial Account(s) per bank signature card and/or Form HUD-11720 is incorrect.

Ginnie Mae InvestorReporting Manual

Chapter 1, Section VII (B)

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