Fannie Mae on Wednesday launched new social disclosures for its Single-Family mortgage-backed securities (MBS).
The new disclosures — called the Social Criteria Share (SCS) and the Social Density Score (SDS) — are designed to respond to investor feedback and aim to provide single-family MBS investors with insights into socially oriented lending activities, while helping to preserve the confidentiality of mortgage consumers’ personal information, the enterprise said.
With Wednesday’s publication of the new social disclosures, Fannie Mae said it is providing the market with the SCS and the SDS, assigned at issuance, for active and inactive MBS pools issued between January 2010 and October 2022. Fannie Mae added it intends to begin publishing these attributes for new Single-Family MBS issuances beginning on Dec. 2, 2022.
To further assist market participants in their historical analysis, Fannie Mae said, it is also providing a chartbook containing common visualizations of prepayment performance.
“We’re excited to release the new social disclosures after receiving positive feedback on the proposal over the last several months,” said Devang Doshi, senior vice president of Single-Family Capital Markets at Fannie Mae. “This is a significant step forward in terms of providing insights for market participants while working to protect borrower privacy, and we remain committed to continued engagement with the investor community for further developments in socially conscious investments.”
While these pool-level disclosures may support investors in determining which pools may meet their socially minded investment criteria, Fannie Mae is not labeling any pools as Single-Family Social Bonds, it said. Instead, Fannie Mae said it will consider feedback from investors, second-party opinion providers, and other market participants to determine how to approach potential labeled issuance.
Information on the methodology and disclosures is available on Fannie Mae’s website.