MPF Loans Reach $50B

The Federal Home Loan Banks' portfolio of Mortgage Partnership Finance loans reached $50 billion in the first quarter as originations jumped nearly 33% and the first securitization of MPF loans was completed.The Chicago FHLBank bank reported that single-family loan originations jumped from $12.2 billion in the fourth quarter to $16.2 billion in the first quarter. Originations in the third quarter totaled $6.1 billion. Despite runoff from refinancings, the MPF loan portfolio held by participating FHLBanks grew from $41.7 billion in the fourth quarter to $53.6 billion as of March 31. Just before the end of the first quarter, three FHLBanks purchased the senior tranches of a $475 million collateralized mortgage obligation -- backed by MPF loans originated by National City Mortgage and Wells Fargo Home Mortgage. The $475 million CMO is the first "shared funding" transaction, and it is designed to make the MPF program more attractive to the FHLBanks' largest members.