Banking giant JPMorgan Chase issued its first private-label residential mortgage-backed securities deal of the year, signaling the company’s comeback to this segment of the market.
The platform J.P. Morgan Mortgage Trust, Series 2013-1 (JPM) reported a total balance of $616.3 million.
The company was set to issue this deal in February, but structural issues got in the way, delaying the process.
Fitch Ratings pre-rated the deal, with the expected outlook slated as ‘stable’ with all the tranches also receiving AAA ratings.
Kroll Bond Ratings also pre-rated the deal, giving the majority of the deal’s tranches AAA ratings.
The platform will contain 752 loans in the deal with more than 96% of the loans in the pool classified as 20-year and 30-year fixed mortgages.
JPMorgan mortgages will make up the majority of the transaction, or roughly 48.1%.
Other originators include First Republic Bank, BMI Residential Mortgage Loan Trust 2010, Bank of Manhattan, Johnson Bank and Dubuque Bank and Trust Company.
In addition, the weighted average borrower credit score is 768. Also, more than 88% of the mortgage pool was contributed by two lenders that Fitch considers to be ‘above average’ originators.
A notable weakness in the deal compared to other RMBS transactions is the representation and warranties and enforcement framework, both credit ratings agencies noted.
The metropolitan areas encompassing Los Angeles, Oakland, San Francisco accounted for 32.2% of the collateral balance and represent three of the top five regions in the deals.
