Senate Schedules Hearing on Private Sector Secondary Market

The Senate subcommittee on Capital Markets and Government Sponsored Enterprises will hold a hearing next Wednesday at 10 a.m. to examine ways in which the government can help create sufficient investor demand for private label residential mortgage-backed securities.  The hearing will also focus on ensuring a well-functioning securitization market and on ensuring transparency and public disclosure to investors.

The subcommittee will move the hearing outside of the District of Columbia, holding it instead at National Museum of the American Indian in New York City.  Scheduled to provide testimony at the hearing are Josh Rosner, Graham Fisher & Co.; Marty Hughes, President and Chief Executive Officer, Redwood Trust; Chris Katopis, the Association of Mortgage Investors; and Ajay Rajadhyaksha, Barclays Capital

Financial Services Committee Chairman Spencer Bachus said, "The nation's housing finance market is currently dominated by government-supported entities.  Fannie Mae, Freddie Mac and the Federal Housing Administration control 90 percent of the market.  The bailout of Fannie Mae and Freddie Mac underscores the need for a modern housing finance system that no longer relies on government guarantees.  Instead, we need a private, competitive market that prices mortgages according to risk and operates free of political interference. A more robust private mortgage market is the solution to ensure that taxpayers are never again left holding the bag for future losses."