MBSIBA Industry Day 4-23-20 Final.pptx

Ginnie Mae MBSIBA Industry Day

April 23, 2020

MBSIBA Industry Day Instructions Presentation begins at 9:00 a.m. and will last for approximately 3 hours.

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WELCOME TO THE MBSIBA Industry Day

Procurement Milestones & Timeline

MBSIBA Procurement Process

ACQUISITION TIMELINE

Ginnie Mae Overview Programs & Products Service Providers & Securitization Platform Key Business Processes & Applications MBS Production Cycle Bond Administration Multiclass Program Ginnie Mae IT Landscape

Agenda

MBSIBA Industry Day

Prerequisites for Bidding Contractor Eligibility Requirements

Ginnie Mae Overview

Ginnie Mae in a Nutshell What?

Guarantees investors the payment of principal and interest due on Mortgage Backed Securities (MBS) issued under Ginnie Mae’s program. The MBS must be backed by mortgage loans that are guaranteed or insured by the U.S. Government (FHA, PIH, VA, USDA).

Why?

To attract domestic and global capital to the nation’s housing finance markets as well as to improve the ability to trade mortgage investments (liquidity), which together:

Increase the availability of funds for mortgages, and Benefit first-time homeowners and low and moderate income borrowers.

Provides the framework and infrastructure needed by approved entities (Issuers) to pool loan and loan packages as collateral for a MBS that will carry the Ginnie Mae guaranty.

Issuers obtain the right to issue MBS carrying Ginnie Mae’s guaranty by entering into a Guaranty Agreement with Ginnie Mae which requires Issuers to pay a monthly Guaranty fee and abide by a set of requirements detailed in the Mortgage Backed Securities Guide, HUD Handbook 5500.3, REV-1.

How?

Differences between Ginnie Mae & The GSEs Differences From Other Industry Participants

Modified Pass Through Securities Supported by Proprietary Securitization Platform

Issued by MBS Program Participants – Not by Ginnie Mae

Explicit Federal Government Guaranty – Full Faith and Credit of U.S. Government

Only for Federally Guaranteed or Insured Loans

GSE’s

Ginnie Mae does not purchase loans or MBS

Ginnie Mae does not issue or sell MBS

Lenders/Servicers

Ginnie Mae does not originate loans or provide financing for other lenders

Ginnie Mae does not service loans, with the exception of seized portfolios

Insuring Agencies

Ginnie Mae does not insure lenders against borrower credit risk

Ginnie Mae does not set credit or underwriting standards

Ginnie Mae Business Model Ginnie Mae Core Functions Administrator of a Federal government guarantee of timely payment of principal and interest (P&I) to investors (mainly MBSIBA supported) Data disclosure to bring transparency to the market (MBSIBA & MBSOA supported) Program and counterparty risk management Interface with global investment community

Unique Business Model Ginnie Mae is in the fourth loss position behind:

Equity of the borrower Mortgage insurance Financial resources of Issuers Only when all three of the preceding layers of risk protection are exhausted or fail is the Ginnie Mae program exposed to loss.

Borrower Lender/Issuer Global Investor Monthly P&I Ginnie Mae guaranteed pass-thru of monthly P&I Federally guaranteed loan (FHA, VA, PIH, and RD)

Mortgage-Backed Securities Cash Flow MBS Process Investors supply liquidity by purchasing Mortgage-backed Securities (MBS)

Snapshot of Ginnie Mae Through strength, simplicity, and agility of its MBS program and Securitization Platform, Ginnie Mae has experienced steady, increased secondary mortgage market share growth.

Second largest MBS guarantor after Fannie Mae, measured by securities outstanding.

MBSIBA will seamlessly support monthly Issuance volumes, bond administration transactions and program participants using Ginnie Mae’s proprietary Securitization Platform.

Ginnie Mae’s Securitization Platform is made up of proprietary business applications, databases and systems that are highly customized and automated.

Ginnie Mae by the Numbers $2.118 Trillion current outstanding Ginnie Mae securities 12/2019 $455 Billion New MBS guaranteed in FY19 $56.7 Billion average monthly MBS issued in FY20 through 2/2020 $54 Billion average monthly P&I paid to investors in FY20 through 2/2020 400 Active Issuers 4 Guarantors

39 Document Custodians

Ginnie Mae’s Growth – MBS Outstanding Ginnie Mae reaches $2 trillion mark Ginnie Mae Annual Issuance ~$500B

1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 0 0 452000000 2600000000 4800000000 7332296000 11723000000 17723000000 30300000000 42931883000 53210100000 69006000000 90428900000 103749900000 214889460000 216489600000 221539200000 267407500000 241280438000 309025729900 333177000000 361290800000 394858600000 422500800000 422254600000 415992300000 445523100000 464237781000 497000000000 531000000000 542200000000 569649659000 603471487000 604308600000 568351015000 473907979000 453421816000 412303791000 409990230000 427566299000 576761925000 826016583000 1046179139000 1221685233000 1341404733000 1457108143000 1541633000000 1608800000000 1705800000000 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 500000000000 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1000000000000 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 1500000000000 Total MBS Outstanding

Ginnie Mae Pool Issuance – To March 2020 Ginnie Mae Pool Issuance

Ginnie Mae Business Volume Highlights

(Avg ~ 3 / month)

$42.4 Billion

$27.4 B or 65% of GM II * Annual ACH (P&I / G-Fees) ~1,036 per Month

* Based on 12 month average

Programs & Products Overview

Ginnie Mae Programs & Products Overview Single Family Multifamily

HMBS

Manufactured Housing Programs Products Ginnie Mae I Ginnie Mae II Multiple Issuer Pools Platinum

REMIC

Single Class Securities Multiclass Securities

Single Family (SF) Loans secured by one to four family residential housing units in a single structure.

Insured or guaranteed under the FHA, VA, RD, and PIH programs.

Fixed or adjustable interest rates.

Issued under Ginnie Mae I or Ginnie Mae II programs.

Multifamily (MF) Facilitate the construction and renovation of MF housing such as apartment buildings, hospitals, nursing homes, assisted-living facilities, and other housing options.

Fixed interest rate.

Loans insured under the FHA and RD programs.

Issued under the Ginnie Mae I program.

Manufactured Housing (MH) Loans secured by a manufactured home or both the manufactured home unit and a developed manufactured home lot acquired in a single transaction.

Loans insured under the FHA program.

Currently issued under the Ginnie Mae II program.

Ginnie Mae Programs Single Family, Multifamily and Manufactured housing

Home Equity Conversion Mortgage MBS (HMBS) Provides capital and liquidity for FHA-insured reverse mortgages which lowers costs for the growing population of senior citizens.

Accrual class pass-through securities and therefore do not provide scheduled P&I payments.

Backed by HECM loan Participations which consist of advances made to borrowers, monthly FHA insurance premiums and accrued interest, which may include certain servicing fees and guarantee fees. Participations can serve as collateral to more than one HMBS security.

Unscheduled P&I: full or partial loan payments or purchase of HECM loan Participations.

Purchase events: Mandatory event, Optional event, or Defective Loans.

Mandatory buy-outs occur when the HECM outstanding principal balance is equal to or greater than 98% of the Maximum Claim Amount.

Participations = 11.7 million; HMBS Loans = 310,000; monthly passthrough ~ $0.8 – 1.0 Billion Serial Notes Provides for the sequential retirement of security units subject to the amount of principal available each month.

Each sequentially numbered security unit has a face value of $25,000, except for the last unit, which may exceed that amount.

Backed by Single Family, Level Payment Mortgages.

Ginnie Mae Unique Programs and Products Home equity Conversion Mortgage MBS and SERIAL NOTES

HMBS & Serial Notes Are Not Supported By Any Other MBS Securitization Platform

Ginnie Mae I & Ginnie Mae II

depending on pool type

Key Differences

Multiclass Platinum securities allow investors to combine Ginnie Mae MBS pools with uniform coupons and original terms to maturity into a single security.

Collateralized by Single Issuer Ginnie Mae I Pools, Single and Multiple Issuer Ginnie Mae II SF Pools, HMBS or other Platinum Pools. The securities must have the same pool type, coupon rate and delivery eligibility. Depositors can contribute entire or partial pools of Ginnie Mae MBS certificates.

MBS

MBS

Platinum Security

MBS

Combine MBS Platinum

REMICs direct P&I payments from underlying MBS to classes with different principal balances, interest rates, average lives, prepayment characteristics and final maturities.

Allow investors with different investment horizons, risk-reward preferences and asset-liability management requirements to purchase MBS tailored to their needs.

Remic

Program Participants & Stakeholders Program Support

Centralized Help Desk Single Class Program and Relationship Management Policy Interpretation Program Participant Training Multiclass Program and Relationship Management REMIC Program Support Counter Party Risk Management Compliance Reviews Manage Issuer Defaults

External Program Participants

Issuer

Custodian

Internal Stakeholders

Securities Operations

Capital Markets

Other Vendors

MBSOA

Software Development

Subservicer

Issuer and Portfolio Management

IBM

Cloud Provider

REMIC Vendor

Depositor

Sponsor

Monitoring Division

Enterprise Risk

Investors

Front Office

Service Providers and Securitization Platform

MBSIBA Services Program Management Pool Processing Agent (PPA) Services Process/issue SF, MF, HMBS and Platinum MBS Deliver original issue book entry securities to Ginnie Mae’s Depository – FRBNY Central Paying and Transfer Agent (CPTA) Services Calculation, collection, and distribution of P&I due security holders Collection of Ginnie Mae fees Factor information and Data Disclosures Ongoing Bond Administration Multiclass Securities Services (Platinum & REMIC) Hosting, Network and Applications Operations & Maintenance (O&M) Federal Information Technology Security Enhancements, Integrated Software Development & Next Gen Support Conferences and Trainings

SSAE 18

Optional: Data Center Migration Services are currently provided by BNYM

MBSIBA Applications, Databases & Systems

Accessed via Ginnie Mae Enterprise Portal (GMEP1.0)* Customer Service Inquiry Generalized Mortgage-Backed Securities Subsystem (GMBS)

(a) Central Registry

(b) Tax Reporting and P&I Processing

(c) Transfer Processing

3. New Pool Processing Subsystem (NPPS)

4. Platinum Pool System

5. Pool Reporting Subsystem (PRS) Adjustable Rate Mortgage (ARM) Index Commitment Management (CM) Congressional Budget (CB) Master Agreements Management System (MAMS) Pool Transfer System (PTS) Report Center Request Pool Numbers (RPN) RSA SecurID Token Management Unclaimed Funds II (UFS II)

*GMEP 1.0 hosts many other applications, however they are out of scope therefore, not listed above.

Single Family Pool Delivery Module (SFPDM) (future) Platinum Application Unclaimed Funds I (UFS I) Letters of Credit Corrections Help Desk

* MyGinnieMae Portal provides single sign-on access to legacy GMEP 1.0 and GinnieNET.

Note: GMEP 1.0 applications are to be portletized and will be hosted on MGM to enable the decommissioning of GMEP 1.0 in the future. GinnieNET Enterprise Wide Operational Data Store (EWODS)

(a) Online Transaction Processing (OLTP) Public Facing Searchable Databases

(a) Multifamily Database

(b) Platinum Database

(c) REMIC Database SAP Business Objects (BOBJ) Informatica

Mortgage-Backed Securities Operations & Analytics (MBSOA)

Program Management Data Collection, Validation and Reporting of Ginnie Mae’s MBS Collateral Data Disclosures, Regulatory and Compliance Monitoring and Reporting Risk and Information Analytics Risk Review of New Issuer Applications Special Projects Applications O&M Services Small Application Enhancements Services are currently Provided By Deloitte

MBSOA Applications Points of Intersection with MBSIBA

Relies on MBSIBA EWODS Data

1. Contact Management (CMgnt)

2. Custodial Account Verification System (CAVS)

3. Data Disclosure (DD)

4. E-Notification (EN) (Program participant communication used by MBSOA & MBSIBA)

5. HMBS Reporting and Administration (HRA)

6. Independent Public Accounting (IPA)

7. Matching and Suspense (MAS)

8. Pool Accounting and Exception Feedback (PAEF) Single and Multifamily modules

9. RFS Administration (ADMIN)

10. Servicemembers’ Civil Relief Act (SCRA)

11. Widely Held Fixed Investment Trust (WHFIT) 1. Corporate Watch (CW)

2. Data Analysis and Reporting Tool (DART)

3. Executive Dashboard

4. Ginnie Mae Meta Data System (GEMS)

5. Ginnie Mae Operational Data Store (GMODS)

6. Ginnie Mae Portfolio Analysis Database (GPADS)

7. Issuer Operational Performance Profile (IOPP)

8. Master Subservicer Operational Reporting (MOR)

MBSIBA relies upon data from MBSOA applications:

PAEF (SF/MF) and HRA (HMBS): Supports Issuer RPB reporting used for factors and P&I payment calculations.

SCRA: Supports SCRA Federal program compliance and related Issuer interest rate differential payments.

WHFIT: Supports investor tax reporting.

MBSOA relies upon data from MBSIBA applications:

Data Disclosure: Supports daily and monthly Investor Data Disclosures.

GMODS: Data store supporting Risk and Information Analytics data marts.

IPA: Evaluation and rating of Issuer Financials.

LEGEND

MBSIBA/MBSOA Dependency No Direct Dependency

Securitization Division of Contractor Responsibilities

Calculation, collection and distribution of P&I due security holders.

Ongoing Bond Administration.

Platinum Trustee & REMIC Information Agent.

Engineering, hosting, security, O&M, and enhancements of IT infrastructure, systems and applications supporting these services. Investor Reporting & Disclosures.

Ongoing Bond Administration.

Risk & Information Analytics.

O&M, security & enhancements for applications and systems supporting these services.

IT infrastructure and application hosting for MBSOA applications / systems.

Granting application access for Ginnie Mae applications hosted by the ITIC Provider.

In the future, there could be one or more ITIC Providers.

Support integrated MBS business processes and data exchange.

This work requires high levels of Contractor collaboration.

The incumbent PPA/CPTA contractor will transfer all services and related infrastructure, systems and applications to MBSIBA.

MBSIBA / MBSOA Systems & Processes are Highly Integrated

ENTERPRISE WIDE OPERATIONAL DATE STORE (EWODS) / OLTP

EWODS stores all Ginnie Mae operational enterprise data. Data is exchanged and shared between MBSIBA and MBSOA via ETLs/APIs.

Below are some examples:

MBSOA Data to MBSIBA:

Monthly Security RPB’s for Factor and P&I calculations.

Monthly MF delinquency information for MF Database.

Quarterly SCRA Payment file for Issuer SCRA payment processing.

Monthly Tax Reporting Expense & quarterly WHFIT for investor tax reporting.

MBSIBA Data to MBSOA:

Daily and Monthly Data Disclosures published by MBSOA.

EWODS data to GMODS for Risk and Information Analytics.

EWODS data to Salesforce for CRM, workflow and decision management.

Securitization Platform MyGinnieMae Portal

Collect Fees

Disclosures GinnieMae.gov

MF

Platinum

REMIC

ARM

PTS

UFS I & II

Salesforce

CAVS

SCRA

WHFIT

GMODS

GPADS

IOPP

CW

DART

MOR

Dashboards

IPA

GinnieNET

SFPDM

(future)

LOC

MAMS

CM

RPN

MFPDM

Platinum Central Registry

NPPS

MERS

MBSIBA Clearing

RFS PAEF / HRA / MAS

PRS

GMBS

ACH & Fedwire Pay.gov MBSIBA Treasury

LEGEND

MBSIBA MBSOA External

Enterprise Systems Architecture

Marco

Help Desk & MGM

Key Stakeholders MBS Program Participants Policy Division Web Manager Multiclass, SF & MF Divisions Infrastructure Support

OEDTS

Change Mgm’t IT Support

MBSIBA

Tier 2 & 3 Support for Applications / Services MGM Operations Admin.

MGM Platinum Org. Admin.

Metrics Integrate with IVR

MBSOA

Tier 2 & 3 Support for Applications / Services Metrics Integrate with IVR ServiceNow Help Desk Tool Configuration Set up KPIs Integrate with IVR and Portal Centralized Help Desk Ginnie Mae plans to implement ServiceNow and an IVR solution to deliver a best-in-class customer experience and to automate and standardize business processes. MBSIBA will provide Tier 2 & 3 agents skilled in resolving customer inquires for the applications and services it provides.

Centralized Help Desk

1-833-GNMA-HELP

8:00 a.m. - 7 p.m.

Key Stakeholders

Infrastructure Support

MBSOA

Help Desk

MBSIBA

Help Desk

ServiceNow Contractor

MBSIBA Customer Phone Inquiry

DECEMBER 2019 – FEBRUARY 2020

SINGLE GATEWAY TO GINNIE MAE SYSTEMS, APPLICATIONS, AND RESOURCES

MyGinnieMae (MGM) Portal MGM is based on Oracle WebCenter with seamless user registration and enhanced security. It will eventually replace GMEP 1.0 and serve as the primary portal platform.

ISSUERS responsible to provide Org. Admins.

MBSIBA shall provide a minimum of 3 Org. Admins.

Operations Administrators MBSIBA provides general oversight of the Portal in conjunction with Ginnie Mae Information Security.

Creates, supports and approves Org. Admins and validates they are on the form HUD 11702.

Provides final acknowledgement of access requests but, cannot make any changes to end user accounts.

End Users Provided access based on their functional roles.

MBSIBA hosts and provides application O&M for MGM. It is the MGM Operations Administrator and also provides a minimum of 3 Organization Administrators.

Ginnie Mae Enterprise Portal (GMEP) and GinnieNET (GNET)

MBSIBA hosts and provides application O&M for GMEP and GinnieNET.

Ginnie Mae Enterprise Portal (GMEP 1.0) GMEP 2.0 portal, provides access to several Ginnie Mae applications including Integration Pool Management System (IPMS) – Modernized , Reporting and Feedback System (RFS) and Salesforce apps.

GinnieNET (GNET) GinnieNET is an Internet-facing website that is used by Issuers to electronically submit Mortgage Backed Securities (MBS) pools, final certifications and recertification information, forms HUD 11708 and HUD 11710D, Quarterly Certifications, Remaining Principal Balances (RPB), monthly Remittance Advice information (forms 11714 and 11714SN), Transfers of Document Custodian responsibility, Certification and Agreement (form HUD 11711B), and ACH Debit Authorizations (form 11709A).

GinnieNET is used by Document Custodians to certify or reject submissions.

MGM, GMEP 1.0, GinnieNET – Conceptual Diagram MBSIBA hosts and provides application O&M for MGM, GMEP and GinnieNET.

MGM, GMEP 1.0, GinnieNET – Application Architecture

Presentation Layer MyGinnieMae

GMEP 1.0

GinnieNET OHS 12c (v12.2x) WebCenter Portal 11g WebLogic Portal 11g

MS IIS 7.5

Identity & Acc Mgmt 11g SOA Suite 12c OHS 12c (v12.1.3.0) WebLogic Server 11g Java Dev Kit (JDK) 1.7 Java Dev KIT (JDK) 1.6 WebLogic Server 11g SOA Suite 11g SAP BOBJ v4.2 Java Dev Kit (JDK) 1.7 MS .NET Framework 2.0 MS Office 2010 Crystal Reports v13.0.2 MS Visual Basics 6.0 Apache v2.4.41

Oracle DBMS 11g MS Windows Server ‘08 MS Windows Server ‘08 Red Hat Linux 6.x MS Windows Server ‘16 Red Hat Linux 7.x

ESX 5.5

Oracle UNIX Solaris 10 Red Hat Linux 6.x Red Hat Linux 7.x

ESX 5.5

Oracle UNIX Solaris 10 Application Layer Database Layer Operating System Layer

EWODS - Oracle DBMS 11g Oracle DBMS 11g MS IIS Web Server ‘08

OHS

MS IIS Web Server ‘08

Informatica PowerCenter 10.2 Business Function: MyGinnieMae, GMEP 1.0, and GinnieNET are tightly integrated, dependent upon one another, and play major roles in Ginnie Mae’s business lifecycle.

Current Max Version: 12cr1 Current Max Version: 12cr1 Current Max Version: 18c

Informatica PowerCenter 10.2

Informatica PowerCenter 10.2

Validated INF Stability 18c 12c 11g

RFS ODAC

EOL concerns are distributed across all layers of the system architecture, primarily in Ginnie Mae’s aging legacy systems – GMEP 1.0, RFS and GinnieNET Unavailability or security breaches for any of these systems would have major impacts to Ginnie Mae’s business operations Software compatibility and dependencies must be taken into account when planning database upgrades Hardware that these systems run on are also reaching, or have reached, EOL

GMEP 1.0 Portal Architecture

GinnieNET Website Architecture

Ginnie Mae Salesforce CRM System Architecture

Application Dependencies TRANSACTIONAL DATABASES (11g - 11.2.0.4)

EWODS

IPMS OLTP

IPMS ODS

WebLogic portal WebCenter

OIAM

SOA

SAP BOBj Informatica REPOSITORY DATABASES (11g – 11.2.0.4)

MYGINNIEMAE

WebCenter

OIAM

SOA

SOA 11g WebLogic Portal SAP BOBj Informatica The following applications have dependencies on EWODS, IPMS OLTP, IPMS ODS.

GinnieNET GinnieNET

Golden Gate

GMEP 1.0

(IPMS/ RFS)

Golden Gate

MY GINNIE MAE MONTHLY USER LOGINS - TOTAL VS UNIQUE

Ginnie Mae User Logins User Logins will Increase as MGM Issuer Adoption Progresses

Ginnie Mae User Logins

GINNIE MAE GMEP PORTAL AND GINNIENET

appendix

Key Business Processes & Applications

MBS Production Cycle Ginnie Mae’s Securitization Platform supports every Ginnie Mae product and is scalable, reliable and compliant with Ginnie Mae’s governance structure.

The Platform is highly integrated with other applications some of which are hosted, operated and maintained by business partners other than the MBSIBA.

The Ginnie Mae Securitization Platform is the only software that supports HMBS and Serial Notes.

The applications described in the following slides are mature and have been running in production for at least one and – in most cases - many years.

MyGinnieMae, Multi Family Pool Delivery Module (MFPDM) and Platinum applications in production for more than a year, and the Single Family Pool Delivery Module (SFPDM) was recently moved to production on a pilot basis and is scheduled for deployment CY 2020.

Modernized IPMS (M-IPMS) has been in production for several years, and the Mainframe IPMS has been in production for decades.

Securitization platform

MBS Production Cycle Submit Pool/Loan Investor Reporting - Remaining Principal Balances Calculate Payment; Deliver Pre-collection Remittance Advices Pool Level Daily/Monthly - Calculate & Post to Website Loan Level Daily/Monthly - Calculate & Post to Website Issue MBS and Deliver MBS to FRBNY Issue MBS Create Prospectus and Update Central Registry Request Commitment Authority and Pool numbers #’s Submit Pool/Loan Data for MBS Issuance Submit & Approve Master Agreements Apply for Approval as Ginnie Mae Issuer Execute ACH to Collect Funds from Issuers Distribute P&I to FRBNY for Payment to Investors Multifamily & REMIC Databases Factor Files (Preliminary & Final) - Posted to Website Database Search by CUSIP/Pool Service Pooled Mortgages In Accordance With Ginnie Mae/Industry Standards Prospectus Generation and Retrieval Make Bond Payments Publish Data Disclosure

Issue MBS and Deliver MBS to FRBNY Create Prospectus and Update Central Registry Request Commitment Authority and Pool numbers #’s Submit Pool/Loan Data for MBS Issuance Submit & Approve Master Agreements Apply for Approval as Ginnie Mae Issuer

Run The Railroad - OVERVIEW

1 – Apply for Approval as Ginnie Issuer & Establish System Access Issuer applies for approval and pays fee directly to Ginnie Mae.

Ginnie Mae owns the due diligence and approval process. Upon approval, Ginnie Mae assigns an Issuer ID, key enters Issuer information into the IPMS Issuer Management System and places new Issuer status code 98I – removing the new Issuer status code when all onboarding activities are completed.

MBSIBA – Receives a memo from Ginnie Mae confirming issuer approval and issuer ID number and enters the new Issuer information onto IPMS PRS.

Issuer representatives present themselves in person to MBSIBA with appropriate identification and the MBSIBA establishes them as Systems Administrator / Org Administrators. MBSIBA also supports RSA token assignment and activation.

Issuer Org Administrators assign functional roles within the Issuer organization and establishes access to GinnieNET and MyGinnieMae.

As MGM is universally adopted, user access will be established only to MGM and subsequently by the Issuer Org Admin via functional roles from within MGM.

Apply for approval as issuer

Apply for Approval as Ginnie Mae Issuer

2 – Submit and Approve Master Agreements Using Master Agreement Management System (MAMS), Issuer submits electronic Master Agreements and sends hard copy Form 11702 with wet signature to MBSIBA.

MBSIBA – Reviews documents, retains hard copy Form 11702 and provides user assistance for MAMS.

Upon submission of an original or updated Form 11709-A (ACH Debit Authorization), MBSIBA arranges for ACH zero dollar debit “prenote”, sends secure email to Issuer and coordinates with Issuer to ensure that the prenote clears.

Issuer’s are responsible for renewing Master Agreements annually. MBSIBA assists Ginnie Mae to track renewals (ad hoc reporting) and follows up with Issuers to ensure agreements are renewed by Dec 31.

MBSIBA provides O&M support and customer assistance to applications above.

Master agreements

Submit & Approve Master Agreements

3 (a) – Request Commitment Authority Using Commitment Authority Management System (CA), Issuer submits electronic request to purchase Commitment Authority.

CA system calculates Commitment Fees and creates ACH file, MBSIBA submits ACH file to payment network, collects fees, confirms receipt in CA and forwards to Ginnie.

Ginnie Mae reviews and approves, denies or partially approves Commitment Authority which is documented by Ginnie Mae within the Salesforce approval workflow.

MBSIBA provides O&M support and customer assistance to applications above except for Salesforce which is supported by the MBSOA.

3 (b) – Request Pool Numbers Using the Request Pool Number (RPN) application, Issuer requests a block of assigned pool numbers. RPN enforces business rules with logic based upon historical pool usage to assign appropriate number of pools.

Ginnie Mae can over-ride and assign a larger block of numbers if appropriate.

MBSIBA provides O&M support and customer assistance to applications above.

Commitment authority & Pool numbers

Request Commitment Authority and Pool numbers #’s

MBS Production Cycle – Items 1-3 Summary By Role & Application Prerequisites for Pooling

GMEP

Pool Delivery Modules (PDM) Attend in-person Organization Admin. on-boarding at MBSIBA site.

Enroll as MGM user with functional roles to allow upload of Master Agreements.

Obtain access to GMEP & PDMs On-boards Issuers and Document Custodian Organization Admin.

Validates authority on form HUD 11702 – authorized signers

ACH & pay.gov Submit CA request and ACH instructions Purchase CA once approved Pay Commitment Application Fee Validate Issuer CA.

Collect CA Application Fee via ACH and remits it to Ginnie Mae no more than 3 BD after via pay.gov.

4 – Submit Pool/Loan Data for MBS Issuance Using GinnieNET, MF or SF Pool Delivery Modules, Issuer submits electronic Form 11705 and 11706 Pool and Loan records. Software applies business rules and edits in conformance with Ginnie Mae’s pooling requirements.

Using GinnieNET the Document Custodian certifies pools.

GinnieNET network is swept 2x per day (2:00 p.m. & 9:00 p.m.) for processing into IPMS. Pools certified by 2:00 p.m. EST can be delivered for settlement the next day; pools certified after 2:00 can be delivered in 2 business days.

MBSIBA utilizes mainframe Integrated Pool Management System (IPMS) to monitor exceptions, perform additional edits, and release the pools for issuance. IPMS/NPPS draws down Commitment Authority, updates Central Registry, rolls loan packages up to the Multiple Issuer Pool and creates files for delivery to the FRBNY.

Exception processing: Approximately 15 – 20 manual “paper” MF pools per month.

MBSIBA enters manual pools into IPMS which applies edits described above.

MBSIBA provides O&M support and customer assistance to applications above.

Submit pool loan data for issuance

Submit Pool/Loan Data for MBS Issuance

5 – Issue MBS and Deliver to FRBNY MBSIBA – uses and operates IPMS “internally” to issue and deliver MBS.

Once a pool meets all Ginnie Mae requirements and there are no exceptions, reports are generated, reviewed and approved and the pool is released to FRBNY for settlement and issuance.

The following modules of IPMS are updated with pool / investor data.

New Pool Processing Subsystem (NPPS): Logs pool as funded and the Issuer’s commitment line is permanently drawn down when the pool is issued.

Pool Reporting Subsystem (PRS): Updated with all pertinent pool and loan package data.

GMBS Central Registry: Updated with certificate / investor data.

IPMS creates New Issue File with CUSIPs as well as the Pool Delivery files and delivers to the FRBNY.

MBSIBA provides O&M support and internal assistance to applications above.

Mbs issuance and delivery

Issue MBS and Deliver MBS to FRBNY

6 – Update Central Registry Using the IPMS Generalized Mortgage-Backed Securities Subsystem (GMBS), the MBSIBA is responsible for updating and maintaining the Central Registry.

GMBS/Central Registry contains information about investor, the corresponding certificates and is the official repository for the owner of record for each Ginnie Mae MBS.

Since implementation of book entry issuance, the holder of record on Central Registry is the FRBNY.

GMBS supports the validation of legacy, physical certificate transfers and posting of original issuance securities.

MBSIBA is required to perform daily and monthly reconciliations with FRBNY reports for all book entry pool positions.

Central registry

Create Prospectus and Update Central Registry

6 (continued) – Create and Update the Prospectus MBSIBA prepares the prospectus for Ginnie I, Ginnie II Custom, Platinum and Multiple Issuer Pools. For all pools submitted electronically, MBSIBA creates the Prospectus Files and posts to the Website.

Multi Family Issuers provides prospectus for paper (non-electronic) pool submissions.

Ginnie Mae’s software supports the creation of prospectus’ for electronically submitted pools.

prospectus

Create Prospectus and Update Central Registry

MBS Production Cycle – Issue MBS Items 1 – 6 Summary

POOL SUBMISSION, PROCESSING, ISSUANCE & SETTLEMENT

MBS Production Cycle – Items 4-6 By Role & Application

7 & 8 – Service Pooled Mortgages & Investor Reporting Issuer services mortgages in accordance with industry standards.

Issuer performs RFS loan/pool investor reporting by 4th BD.

MBSOA contractor performs investor reporting validation and editing working with Issuers to collect 100% pool and loan data.

Although these business activities are supported by the MBSOA, the MBSIBA hosts, operates and maintains the SFTP servers, EWODS data bases, GMEP 1.0 and other activities that supports these processes.

Service pooled mortgages / investor reporting

Submit Pool/Loan Investor Reporting - Remaining Principal Balances Service Pooled Mortgages In Accordance With Ginnie Mae/Industry Standards

9 & 10 – Calculate Payments / Execute ACH MBSOA releases Security Balance (RPB’s) to EWODS table and balances transferred to IPMS.

MBSIBA calculates bondholder payments using IPMS/PRS/GMBS, creates pre-collection notices which are delivered to Issuers 3rd and 6th business day using RFS e-Notification.

Pre-collection notice confirms exactly how much P&I and Gfee to be collected from the Issuer, from which bank account and on which day.

MBSIBA creates payment factor files for delivery to FRBNY; The FRBNY performs its calculations and the MBSIBA resolves any factor/payment edits errors with the FRBNY.

MBSIBA creates ACH files for submission to the ACH Network and executes ACH on the passthrough date.

Calculate payment / execute ach for p&I and G-fee

Calculate Payment; Deliver Pre-collection Remittance Advices Execute ACH to Collect Funds from Issuers

11 – Collect and Distribute P&I to the FRBNY The morning of the distribution date 15th and 20th:

Automated Clearing House credits the MBSIBA Ginnie Mae P&I account for total ACH debits.

MBSIBA transfers funds to internal distribution account and wires P&I to FRNY using Fedwire Funds.

FRBNY credits investor book entry positions.

MBSIBA monitors P&I account for any ACH returns.

Ginnie Mae II Physical Certificates - Collect and Distribute P&I MBSIBA ACH’s funds from Issuers on the 19th and distributes checks or electronic payments to certificate holders by the 20th.

Approximately 500 checks representing $18 - $21K in aggregate monthly payments – volume is declining.

Collect and distribute p&I

Distribute P&I to FRBNY for Payment to Investors

11 (Continued) – Collection of Guaranty Fee MBSIBA collects G-Fee from issuers using ACH.

Morning of 10th Calendar Day Ginnie I and 19th Calendar Day Ginnie II MBSIBA reconciles and forwards G-Fee to Ginnie Mae same day as collected using pay.gov.

MBSIBA monitors account for any ACH returns.

In the event of a return, Ginnie Mae will coordinate with Issuer to wire funds to MBSIBA or Ginnie Mae will reimburse the MBSIBA.

Guaranty fee

Collect Guaranty Fee and forward to Ginnie Mae using pay.gov

12 & 13 – Disclosure Loan & Pool Data Monthly & Daily MBSIBA disseminates Factor information on a monthly basis and provides data disclosure on newly issued MBS.

MBSIBA, Ginnie Mae and MBSOA coordinate to perform ongoing enhancements to data disclosures.

MBSOA posts data disclosures to www.ginniemae.gov.

Ginnie Mae’s website has comprehensive information about file layouts, schedules, Prospectus, Global Market Analysis Reports and more.

disclosure

Pool Level Daily/Monthly - Calculate & Post to Website Loan Level Daily/Monthly - Calculate & Post to Website

14 - Factor Files (Preliminary & Final File) – Posted to the Website

MBSIBA computes the security factor for each Ginnie Mae I and Ginnie Mae II pool, including each Multiple Issuer and Platinum pool on a monthly basis.

Factors intended for the global capital markets are posted to Ginnie Mae’s Website.

Preliminary Factors: Posted to website NLT 9:30p.m. EST on the 4th business day.

Final Factors: Posted to Website NLT 7:30 p.m. EST on the 6th business day.

MBSIBA transmits payment factors separately to the FRBNY.

Factor files

Factor Files (Preliminary & Final) - Posted to Website

15 through 17 - Database Search by CUSIP/Pool and MF/Platinum/REMIC Databases and Prospectus Generation and Retrieval

MBSIBA provides support and updates to MF, Platinum and REMIC Databases.

MF Database: Includes information on Ginnie Mae’s MF MBS at the security and loan level. Data can be searched based upon pool number, CUSIP number, FHA or RD case number, pool type, or Issuer number.

Platinum Database: Data can be searched based on CUSIP number or pool.

REMIC Database: A search tool and a vehicle to post and display data from all REMIC participants.

The MBSIBA and the Deal Team (sponsor, trustee, financial advisor, and accountant) post and retrieve various data to, and from this site.

REMIC Trustees post factors on a monthly basis along with floating rates and series factors.

MBSIBA posts adjustable rate indices and forwards Offering Circular Supplements to Ginnie Mae for posting to the website.

The REMIC Search Tool displays REMIC deal data – payment factors, rates, and indices and is searchable by CUSIP or Deal number Database search by cusip/pool

Multifamily & REMIC Databases Database Search by CUSIP/Pool Prospectus Generation and Retrieval

MBS Production Cycle – Prerequisites and Preparation MBSIBA Prerequisites & Preparation For Issuing Securities CUSIPs: MBSIBA is required to purchase and assign CUSIP numbers for Multiple Issuer Pools (MIPs) and Platinum Pools. (Issuers are responsible to obtain CUSIPs for GN1 and GN2 Custom pools).

Estimate approximately 500 MIP and 300 Platinum CUSIPS per year.

IRS Employer Identification Numbers (EINs): MBSIBA is required to obtain and assign EINS for MIPs and Platinum pools. (Issuers are responsible to obtain EINs for GN1 and GN2 Custom pools).

From time-to-time, the IRS is unable to assign EINs to Issuers in which case the MBSIBA will assist by assigning temporary “dummy” ID’s and following up with Issuer to replace and update IPMS with the permanent EIN.

For example: During a government shutdown or delays associated with the Coronavirus pandemic.

cusips & eins

MBSIBA Prerequisites & Preparation For Multiple Issuer Pools (MIPs) Ginnie Mae’s Securitization Platform supports this process, but there are several activities that the MBSIBA needs to coordinate between it’s IT and Ops teams.

Establish and maintain the “shelf” which is the listing in advance of MIPs established by maturity and coupon.

Using IPMS NPPS, MBSIBA establishes prospective MIP and CUSIP numbers and publishes to Website. MBSIBA creates a new shelf if Issuer submits a loan package not conforming to MIPs already established. The way this works:

Assign next unused MIP number Update MIP Header with the initial loan package information Update loan package with the MIP number Change status of MIP shelf from “Pending” to “Active” Add newly activated MIP number to Ginnie Mae Website IPMS/NPPS will generate prospective MIP numbers for the next 3 months and these jobs can be scheduled or executed manually.

Multiple issuer pools

MBSIBA Activities – Multiple issuer Pools (Continued) Issuers are likely to submit loan packages every day and MBSIBA will process and deliver individual loan package submissions on a flow basis.

Each day MBSIBA will associate individual packages with MIP and add balances, loan and pool count to the MIP then publish daily updates with cumulative balances to website.

MBSIBA executes pre-finalization jobs 5 business days prior to last business day – scheduled or upon demand Using IPMS/NPPS:

Create the MIP Daily Reconciliation Report.

Run MIP Daily Aggregation Report.

Identify and report on all released loan packages within each active MIP.

Ensure that MIP header info reflects the underlying loan packages and is synched throughout the IPMS/NPPS, IPMS/PRS and IPMS/GMBS files.

Identify and resolve any non-released loan packages for the Issue month.

Multiple issuer pools

MBSIBA Activities – Multiple issuer Pools (Continued) MIP finalization runs once a month after all pre-finalization activities completed Runs at night, 4 BD prior to last BD; Using IPMS/NPPS:

Finalize Status Flag for MIPS.

Run Finalization Exception Report .

Generate prospective MIP shelves 3 months ahead, based on MIP activity over the last six months.

Move next month’s issuance loan packages to holding Bucket.

Delete headers for which underlying loan packages never released and add to Monthly Pool Delete File sent to the FRBNY.

Post final MIP listing to Website.

Add MIP to Prospectus File which is used to create the prospectus online for viewing on the Ginnie Mae Website.

Multiple issuer pools

Extraordinary Events Emergency Payments GN1 Physical Certs Emergency payments refer to the circumstance where the Issuer who pays Ginnie Mae I physical certificate holders by check is unable to do so.

This provision has never been implemented for the last few decades, if ever.

Should this occur, Ginnie Mae anticipates that the MBSIBA and Ginnie Mae coordinate with the Issuer to obtain mailing or electronic payment information from the Issuer.

Ginnie Mae would advance funding under our guaranty and the MBSIBA would wire or mail the payments accordingly.

This issuer failure would constitute an event of Issuer default and likely result in termination of the Issuer.

For context: There are 40 Issuers with about 1,450 certificates Ten Issuers hold 90% of physical certs: Banco Popular, MidFirst, Wells Fargo, Carrington, PennyMac, NewRez, Nationstar, BoA, Navy Fed and Bank of OK.

Emergency payments gn1 physical certificates

Occasional Events ACH Returns for P&I Ginnie Mae’s guaranty as to the timely payment of principal and interest is backed by the full faith and credit of the U.S. and Ginnie Mae’s borrowing authority provisions are explained in the Prospectus.

In respect to book entry MBS, the timely payment provisions of the Guaranty are specific to the FRBNY as Depository, and Ginnie Mae utilizes the MBSIBA as the conduit for timely delivery of these funds.

To provide context:

Ginnie Mae has never needed to advance Ginnie Mae / US Treasury funds since the Taylor Bean Whitaker default, approximately 10 years ago.

Last 12 months: 3 P&I failures ranging from $11K to $1.5M;

Prior year: zero P&I failures Failures historically been operational - fraud filters, failure to move funds on time, etc.

Not situations where Issuer did not have the funds; In every case funds were wired by the Issuer to the CPTA the same day Ginnie Mae was notified of the overdraft.

About 3 years ago – One instance where CPTA was in overdraft position overnight; but CPTA and Ginnie Mae had not been notified internally about overdraft until the next morning and funds wired same day.

Ach returns – Passthrough failures

Mitigation to Minimize ACH Returns MBSIBA is likely to execute more than 12,000 ACH’s per year and the historical ACH return rate is low.

Ginnie Mae and incumbent CPTA implemented a monthly ACH zero-dollar debit “prenote” 3 BDs prior to the Ginnie Mae II G-Fee ACH date. Also, all new accounts receive a prenote upon establishment.

Maximizes opportunity to catch account configuration changes, errors or fraud filters.

Because collection of Guaranty Fee is in advance of passthrough; provides an opportunity to identify problems and for Issuer to wire funds to MBSIBA in advance of any anticipated P&I ACH return.

Ginnie Mae has increased the amount of “same day” funds available to wire to the MBSIBA or the FRBNY without incurring potential delays caused by borrowing.

Well in excess of the single largest non-bank Issuer passthrough 2X the amount of scheduled P&I for our largest 7 non-bank Issuers combined Ach returns

What Ginnie Mae Does in Event of P&I ACH Return Issuer’s failure to honor the MBSIBA’s ACH is an event of Issuer default.

MBSIBA notifies Ginnie Mae as soon as possible of return.

Ginnie Mae contacts Issuer to ascertain the reason for ACH return and requests that Issuer Fedwire funds to the MBSIBA within the hour.

Simultaneously, Ginnie Mae Office Of Finance prepares paperwork to wire funds to MBSIBA if Issuer is unable or unwilling to wire funds.

Ginnie Mae monitors progress with Issuer, obtains Fedwire confirmation and confirms receipt by MBSIBA.

If ACH return is communicated close to or after Fedwire close, the Issuer will be instructed to wire funds first thing next day. Ginnie might ask Fedwire Services to keep Fedwire Funds open past deadline, if feasible.

Ginnie Mae Monitoring Division prepares sanctions including Civil Monetary Penalties against Issuer.

P&I ACH return

Bond Administration

Bond Administration

Transfer of Servicing Rights Pool Issuance, Immediate Transfer (PIIT)

$44B CY2019

Issuer transfers servicing rights to another Issuer at the time of security issuance.

Security is issued in the name of the Seller but, the pool is immediately transferred to the Buyer’s Issuer Name and Number.

Ginnie Mae approval is…