| Tuesday, January 9, 2018 | ||||||||
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MANAGING DIRECTOR: |
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US Treasury Market |
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| Date | 1 mo | 3 mo | 6 mo | 1 yr | 2 yr | 3 yr | 5 yr | 7 yr | 10 yr | 20 yr | 30 yr |
| 1/2/18 | 1.29 | 1.44 | 1.61 | 1.83 | 1.92 | 2.01 | 2.25 | 2.38 | 2.46 | 2.64 | 2.81 |
| 1/3/18 | 1.29 | 1.41 | 1.59 | 1.81 | 1.94 | 2.02 | 2.25 | 2.37 | 2.44 | 2.62 | 2.78 |
| 1/4/18 | 1.28 | 1.41 | 1.60 | 1.82 | 1.96 | 2.05 | 2.27 | 2.38 | 2.46 | 2.62 | 2.79 |
| 1/5/18 | 1.27 | 1.39 | 1.58 | 1.80 | 1.96 | 2.06 | 2.29 | 2.40 | 2.47 | 2.64 | 2.81 |
| 1/8/18 | 1.30 | 1.45 | 1.60 | 1.79 | 1.96 | 2.07 | 2.29 | 2.41 | 2.49 | 2.65 | 2.81 |
Source: U.S. Department of the Treasury, as of 1/8/18
Focus on CRA Pools Early in the Year to Ensure Availability
The Community Reinvestment Act is intended to encourage depository institutions to help meet the credit needs of the communities and borrowers in which they operate. CRA eligibility is defined by borrowers or tracts with incomes that are 80% or less of the median income for a particular MSA (Metropolitan Statistical Area). The CRA was enacted by Congress in 1977.
The CRA requires that each depository institution’s record in helping meet the credit needs of its entire community be periodically evaluated by the appropriate Federal financial supervisory agency. One way to accomplish this is with the purchase of CRA targeted mortgage-backed securities. These securities consist of low-to-moderate income borrowers or low to moderate income tracts within the counties in your CRA area. These loans are typically 30 year amortizing loans, however, 15 year mortgages are sometimes available, obviously with a shorter average life and duration.
Country Club Bank will work with your bank’s CRA Officer to determine which loans will qualify to help meet your bank’s CRA requirements. Country Club Bank will then have the loans securitized in a pool issued by Fannie Mae, Freddie Mac, or Ginnie Mae. These pools carry the full faith and credit of the issuing agency. The Ginnie Mae pools are zero risk base, while the Fannie and Freddie are 20% risk weighted. Fannie Mae and FHLMC pools are TBA eligible while Ginnie Maes are not. Banks would be wise to project their CRA needs early in the year to ensure pools can be compiled to meet CRA requirements. CRA targeted mortgage backed pools will satisfy the regulatory requirements of the Community Reinvestment Act, but they also provide monthly cash flow and an attractive yield. These pools are not readily available and take some time to process so the sooner you can address your CRA needs the better.
This information is intended for institutional investors only. The material provided in this document/presentation is for informational purposes only and is intended solely for private use. Past performance is not indicative of future results. This material is not intended as an offer or solicitation for the purchase or sale of any financial instruments.
•Not FDIC Insured •No Bank Guarantee •May Lose Value