The Geary Cos. has formed CEMP to get into the re-securitization market, the firm said today.
CEMP is trademarked and is fully owned by Geary.
The new entity takes recently downgraded MBS from various sources, adds credit enhancement in the form of zero-coupon Treasurys, and then pools them together to create a new security, which becomes ‘AAA’ rated, and then sells the new enhanced security back into the marketplace.
The first re-remic security was CEMP 09-1, which was comprised of 28 different MBS from six different sources that totaled $203 million original face with $164 million current face.
