fibows:
What department within I-banks is responsible for engineering the structured products (passthroughs, CMO's) created from mortgages?

since when are passthroughs "structured"? that's almost as flow as it gets.

 
Jimbo:
fibows:
What department within I-banks is responsible for engineering the structured products (passthroughs, CMO's) created from mortgages?

since when are passthroughs "structured"? that's almost as flow as it gets.

I was always under the impression that since the mortgages are pooled together to form a bond with similar underlying characteristics, that it would be considered "structured".

What am I missing?

 

What is going to happen to these groups now? MBS securitization isn't happening now and clearly the deal flow of the past few years will probably never be realized again, but the "idea" of MBS' is still solid - they just need to be priced in a different way so that buyers will feel comfortable buying them. I have the opportunity to join a MBS desk - is this a horrible idea, even if I'm looking 2-3 yrs out?

 
Best Response
luke77:
What is going to happen to these groups now? MBS securitization isn't happening now and clearly the deal flow of the past few years will probably never be realized again, but the "idea" of MBS' is still solid - they just need to be priced in a different way so that buyers will feel comfortable buying them. I have the opportunity to join a MBS desk - is this a horrible idea, even if I'm looking 2-3 yrs out?
MBS isn't dying by any means. It all has to do with the amount of risk they are willing to take on for their investors.

If you read up about MBS and how they are created by private-label institutions, they have a variety of ways to manipulate and alter the risk of the investments with regards to the residual, tranching, etc.

I can't speak, nor will I give advice on your opportunity though, as I don't know the details.

Call up the bank and ask them about all the concerns you have, prior to taking the job.

 

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