We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Wells Fargo to Re-Enter Private RMBS Market After a Decade
Read MoreHide Full Article
Marking a comeback in the private mortgages market, Wells Fargo & Company (WFC - Free Report) is working on a $441 million mortgage bond without government guarantee along with an AAA rating. The bond’s sale is likely to be finalized in the coming week, per a Bloomberg article.
This San Francisco-based major bank will be offering such a bond for the first time since the financial crisis. Another Wall Street biggie, JPMorgan & Chase (JPM - Free Report) is the only other bank to have reentered the private residential mortgage-backed securities (“RMBS”) market.
Before the crisis, Wells Fargo was one of the top RMBS lenders, with more than $1 trillion worth of mortgages sold in 2005 and 2006 each. In 2008, several risky subprime mortgages securities went down leading to investors losing interest in such securities.
In August 2018, WellsFargo agreed to pay a penalty of about $2 billion to the U.S. Department of Justice for allegedly misrepresenting the securities it had offered in the run-up to the housing crisis.
Per the article, private RMBS market has been gaining strength and reached a post-crisis high of $75 billion in 2018 so far. Also, there are no indications of slowdown in demand for such securities..
While Wells Fargo is undertaking efforts to overcome the previous shortcomings and boost its performance, it faces a legal investigation.
At a hearing held on Tuesday, Joseph Otting, chief of the Office of the Comptroller of the Currency told senators “We are not comfortable where we are with them.” He said that the bank is still measuring the financial harm caused to the 600,000 drivers who were improperly pushed into buying auto insurance.
Also, Wells Fargo’s CEO, Tim Sloan and chairwoman, Betsy Duke are likely to face the Congress sometime soon to testify about the bank’s wrongdoing over the past year.
Wells Fargo’s shares have lost 4.2% over the past three months against 3.8% rise recorded by the industry it belongs to.
The stock currently carries a Zacks Rank #3 (Hold).
First Mid-Illinois Bancshares’ (FMBH - Free Report) 2018 earnings estimates have been revised slightly upward in the past 60 days. Additionally, the stock has jumped 9% in six months’ time. It currently carries a Zacks Rank #2.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
Image: Bigstock
Wells Fargo to Re-Enter Private RMBS Market After a Decade
Marking a comeback in the private mortgages market, Wells Fargo & Company (WFC - Free Report) is working on a $441 million mortgage bond without government guarantee along with an AAA rating. The bond’s sale is likely to be finalized in the coming week, per a Bloomberg article.
This San Francisco-based major bank will be offering such a bond for the first time since the financial crisis. Another Wall Street biggie, JPMorgan & Chase (JPM - Free Report) is the only other bank to have reentered the private residential mortgage-backed securities (“RMBS”) market.
Before the crisis, Wells Fargo was one of the top RMBS lenders, with more than $1 trillion worth of mortgages sold in 2005 and 2006 each. In 2008, several risky subprime mortgages securities went down leading to investors losing interest in such securities.
In August 2018, WellsFargo agreed to pay a penalty of about $2 billion to the U.S. Department of Justice for allegedly misrepresenting the securities it had offered in the run-up to the housing crisis.
Per the article, private RMBS market has been gaining strength and reached a post-crisis high of $75 billion in 2018 so far. Also, there are no indications of slowdown in demand for such securities..
While Wells Fargo is undertaking efforts to overcome the previous shortcomings and boost its performance, it faces a legal investigation.
At a hearing held on Tuesday, Joseph Otting, chief of the Office of the Comptroller of the Currency told senators “We are not comfortable where we are with them.” He said that the bank is still measuring the financial harm caused to the 600,000 drivers who were improperly pushed into buying auto insurance.
Also, Wells Fargo’s CEO, Tim Sloan and chairwoman, Betsy Duke are likely to face the Congress sometime soon to testify about the bank’s wrongdoing over the past year.
Wells Fargo’s shares have lost 4.2% over the past three months against 3.8% rise recorded by the industry it belongs to.
The stock currently carries a Zacks Rank #3 (Hold).
Stocks to Consider
First Financial Bankshares (FFIN - Free Report) has witnessed stable estimates for current-year earnings in the past 60 days. Over the past six months, the company’s share price has increased 28.7%. It currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
First Mid-Illinois Bancshares’ (FMBH - Free Report) 2018 earnings estimates have been revised slightly upward in the past 60 days. Additionally, the stock has jumped 9% in six months’ time. It currently carries a Zacks Rank #2.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>