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Structured Finance Industry Group Challenges Use Of Eminent Domain To Seize Mortgage Loans

RELATED NEW DELHI: There seems to be no let up in the show of BJP's sympathy for President Pranab Mukherjee in view of the suggestion from certain quarters that some of the decisions he took as finance minister between 2009 and 20011 contributed to the worsening of the fiscal deficit. BJP leaders on Friday expressed solidarity with the President in view of what they called "unfair insinuation" that his decisions worsened the fiscal deficit, when they called upon him in connection with their demand for early polls. Sources in the BJP said the expression of support led Mukherjee to say that the fiscal expansion being ascribed to him, in fact, predated his tenure in the finance ministry, adding that former finance minister Yashwant Sinha would bear him out. The BJP delegation, comprising party veteran L K Advani, leaders of opposition Sushma Swaraj and Arun Jaitley and former party chief M Venkaiah Naidu, Sinha and others, broached the topic soon after the principal opposition had taken http://www.firstfinancialuk.com up cudgels for the President in Rajya Sabha. Coming out in support of the President, Jaitley had objected to the blame for the jump in fiscal deficit being heaped upon those "who are not here to defend themselves", stressing that the gap between government's spending and income started widening in 2007 when the government launched schemes as part of Congress's preparations for 2009 polls. On Friday, former finance minister Sinha strongly supported the President's purported contention that the expansion of fiscal deficit was a reality before he took charge of the finance ministry.

Whilst the responses from other banks were clear, the one from Bank of Ireland was measured at best and reserved at worst, indicating a reluctance, Lynch told TheJournal.ie. Whilst the predominant issue this week will be will be the banks offering sustainable solutions to homeowners, the matter of the Bank of Ireland response will also be an issue. Lynch said the meetings this week would provide the committee with a chance to examine lenders responses to the mortgage crisis in detail, particularly mortgage arrears and the target, that by the end of June 2013, banks should have proposed sustainable mortgage solutions for 20% of distressed borrowers. When the banks were last before us, there were no specific targets in place to provide solutions for homeowners in arrears. Those targets are now in place and, more specifically, we will consider how the individual banks are meeting their targets and ensuring that there is a consistency of approach in dealing with distressed borrowers. This afternoons AIB session begins at 2pm, and can be viewed online at Oireachtas.ie . Richie Boucher will appear tomorrow morning, followed by Ulster Bank representatives at 2pm. PTSB CEO Jeremy Masding will appear before the TDs and senators on Thursday. Wealth tax?

Not only would it do irreparable damage to the private mortgage market, undermining Congressional efforts to encourage private capital in the market, but it would also actually injure the local residents these efforts are supposed to be helping." The SFIG brief argues that efforts by Richmond and MRP to seize loans held in PLS Trusts is unconstitutional and could do permanent damage to the U.S. home mortgage system. The brief points to significant risk on three levels: -- The market for securities issued by PLS Trusts will be fundamentally shaken if the structure can be pulled apart by municipalities seizing loans, especially by cherry-picking individual performing loans. -- Each PLS Trust which holds to-be-seized loans will be damaged by an amount that exceeds the face value of the loan, because the structure, as a fixed, geographically diverse pool, will be undermined. The market value of the interests in the PLS Trust will likely decline by an amount which far exceeds the face amount of the loans seized. This injury may well be uncompensable through post-seizure compensation proceedings. -- Each PLS Trust which holds to-be-seized loans will, at a minimum, lose the value of those loans - which the seizure program, by its nature and structure, seriously undervalues as part of its very premise. The consequences will fall upon public and private pension plans, retirement accounts, college savings accounts, hospital and university endowments, and other funds, and ultimately will damage the ordinary Americans who are the beneficiaries of such accounts. The brief also demonstrates that the program would "harm prospective homeowners across the country by imposing new, unanticipated and unquantifiable risks upon investors in mortgages, depressing the value of mortgage-based investments, and impeding the return of private capital to the residential mortgage market." SFIG represents over 150 distinct individual organizations from all sectors of the securitization market, including investors, issuers, financial intermediaries, law firms, accounting firms, technology firms, rating agencies, servicers, and trustees. The group is focused on educating members, legislators, regulators, and others about structured finance, securitization and related capital markets; building the broadest possible consensus on policy, legal, regulatory and other matters affecting or potentially affecting these markets; and advocating on behalf of the structured finance and securitization industry.

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