S&P Sees Huge Impact of Regs, Tech on RMBS

Significant growth in residential mortgage-backed securities volume is being accompanied by regulatory changes and technological advances that will have "a lasting, monumental effect" on the future of that market, according to Standard & Poor's Ratings Services.In a recent commentary, S&P analysts cited the following developments: predatory lending legislation at the state and city levels; advances in alternative valuation modeling; continued standardization of collateral quality characteristics; and the effect of successful modeling in the United States on the advent of global RMBS risk models. "All in all, the explosion of volumes in the residential market has provided opportunities for increased profitability as well as accelerating a number of very positive technological innovations," said Frank Raiter, a managing director in S&P's Structured Finance group in New York. The title of the report is: "As RMBS Issuance Growth Persists, Regulatory Changes and Technological Advances Emerge." S&P can be found online at http://www.standardandpoors.com.