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» VISIT US ONLINE @ DSNEWS.COM 5 A look at facts you didn't know you couldn't live without. Compiled by the DS News Staff Since Q3 2018, U.S. homeowners with mortgages have seen their equity increase to nearly $775.2 billion on an annual basis, according to an analysis by CoreLogic. Privately owned housing starts were at a seasonally adjusted annual rate of 1,256,000, according to a joint report by the U.S. Census Bureau and the Department of Housing and Urban Development. WHAT'S DRIVING THE MSR AND RMBS MARKETS? INSIDE THE JOURNAL // ON THE WEB // THE APP SPECTRUM // MOVERS & SHAKERS TAKE A LOOK INSIDE THE NUMBERS D ATA B I T S * Based on which housing markets "receive the most non-local views (inbound traffic)" and "which non-local markets are of interest to local home shoppers (outbound traffic) based on online traffic on active, for-sale properties on Realtor.com." ** Year-Over-Year Source: Realtor.com's Q3 2018 Cross Market Demand Report 10 METROS ATTRACTING THE MOST OUTSIDE HOMEBUYERS* 10 METROS WHERE LOCAL HOMEBUYERS ARE SHOPPING ELSEWHERE 1 SAN JOSE-SUNNYVALE-SANTA CLARA, CA 0.1 -0.1 2 SAN FRANCISCO-OAKLAND-HAYWARD, CA 0.2 0 3 CHICAGO-NAPERVILLE-ELGIN, IL-IN-WI 0.3 0 4 WASHINGTON-ARLINGTON-ALEXANDRIA, DC -VA-MD-WV 0.3 -0.1 5 NEW YORK-NEWARK-JERSEY CITY, NY-NJ-PA 0.3 -0.1 6 SEATTLE-TACOMA-BELLEVUE, WA 0.3 -0.2 7 ATLANTA-SANDY SPRINGS-ROSWELL, GA 0.3 -0.2 8 DETROIT-WARREN-DEARBORN, MI 0.4 -0.1 9 SALT LAKE CITY, UT 0.4 -0.1 10 JACKSON, MS 0.4 -0.7 1 SPOKANE-SPOKANE VALLEY, WA 3.2 0.2 2 DELTONA-DAYTONA BEACH-ORMOND BEACH, FL 2.6 0.1 3 PORTLAND-SOUTH PORTLAND, ME 2.5 -0.2 4 CHARLESTON-NORTH CHARLESTON, SC 2.4 0.3 5 BOISE CITY, ID 2.4 0.1 6 PALM BAY-MELBOURNE-TITUSVILLE, FL 2.4 0.1 7 MCALLEN-EDINBURG-MISSION, TX 2.3 0.2 8 EL PASO, TX 2.3 0.2 9 NORTH PORT-SARASOTA-BRADENTON, FL 2.2 0 10 KNOXVILLE, TN 2.1 -0.2 Rising mortgage rates are driving a strong demand for mortgage servicing rights (MSRs), even as the issuance of reverse mortgage-backed securities (RMBS) remains healthy, according to the Kroll Bond Rating Agency (KBRA). In a recent report,, KBRA revealed that around $97.1 billion in UPB of bulk MSR sales were completed during Q2 2018, bringing the volumes for the first half of the year close to around $193.3 billion. is high demand, the report said, continued to support valuations and market liquidity, leading banks to provide more credit secured by MSRs. Pointing to Ginnie Mae's recent announcement of a three-year strategic plan to realign its counterparty risk management framework that will allow additional financing for MSRs, the report said: " In addition to banks, GSEs are slowly building support for MSRs as a financeable asset, an effort that will benefit non-bank financial institutions who lack deposit funding." Apart from rising GSE interest in MSRs, the report also indicated capital relief for MSRs thanks to a simplification of capital rules released by the Federal Deposit Insurance Corporation (FDIC) during its semiannual regulatory agenda. e FDIC proposal raises the cap on MSRs allowable in Tier 1 capital from 10 to 25 percent and increases the risk-weighting exposure for these rights above the cap from 100 to 250 percent. If passed, the proposal would remove a significant capital constraint on FDIC- supervised small banks that specialize in mortgage servicing. e report indicated that this would "make it less likely that a small bank would exit or reduce its activity in that space." Looking at RMBS, despite a slight pullback from the highs of Q2, the issuance of RMBS ended Q 3 as the highest post-crisis issuance quarter behind Q2. e data also pointed to an increased risk privatization even though a very small portion of this market, dominated by the GSEs, has non-agency RMBS players. e total issuance in prime, nonprime and CRT sectors was projected to end the third quarter at just above $10.2 billion, the report indicated. "rough mid-September 2018, $33.4 billion has been issued, surpassing the FY 2017 post-crisis record of $29.2 billion. 3Q18 included new issuers in the Non-Prime or Expanded Prime sectors." e KBRA report, which also looked at the overall housing market revealed that despite some softness, the economic environment remained strong for housing. Giving an analysis of individual performances of bank and nonbank mortgage lenders and servicers, KBRA said that while Citi had exited the servicing business thanks to the competitive environment, Bank of America saw a decrease in its mortgage banking revenue over the last year and due to "limited reporting disclosures, the company's mortgage strategy is somewhat a mystery." PAGE 12 Director, Human Resources and Chief Diversity and Inclusion Officer, Ocwen Financial Corporation FIVE MINUTES WITH Lola Oyewole RANK RANK METRO METRO Q3 2018 INBOUND/ OUTBOUND RATIO Q3 2018 INBOUND/ OUTBOUND RATIO YOY** CHANGE IN INBOUND/ OUTBOUND RATIO YOY** CHANGE IN INBOUND/ OUTBOUND RATIO

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