Sector Update

February 14, 2022

Individual Sector Updates – Click to Access

Agency Market | Agency MBS | Agency ARM | Agency CMO | Municipal Market | SBA Market | Interest Rate Products

Today – Yields 6-8 bps higher, curve slightly flatter, equities mixed

Longer-duration mortgage spreads move significantly higher

Equities off to a tough, and volatile, start to the year

Upcoming Webinars – (1 hour CPE available, registration opens 2 weeks prior to each webinar)

1/11: 1st Quarter Economic Outlook Webinar (slides | webinar replay)

2/22 Bank: Positioning the Investment Portfolio for Performance

2/24 Credit Union: Positioning the Investment Portfolio for Performance

3/8 Bank: Balance Sheet Strategies in an Expected Tightening Cycle

3/10 Credit Union: Balance Sheet Strategies in an Expected Tightening Cycle

Treasury yields soar, pushing yields above/towards pre-pandemic highs

Yield on 10- and 5-year maturities remain through pre-pandemic levels

Yield on 3-year moves above pre-pandemic levels, 2-year on the cusp

Curve Shape – 2s5s moves 11 bps flatter last week, 20 bps flatter YTD

Curve Shape – 2s10s moves 17 bps flatter last week, 37 bps flatter YTD

What We’re Reading

Market Today | Daily

Weekly Recap | Weekly, Friday

Monthly Review (January) | Monthly, 1st business day

Brokered Deposit Rate Indications | Weekly, Monday

Investment Alternatives Matrix | Weekly, Tuesday

MBS Prepay Commentary (February) | Monthly, 5th business day

SBA Prepay Commentary (January) | Monthly, 10th business day

WSJ: Inflation by Another Name

“Companies are finding all kinds of ways to make consumers pay for rising costs. Often that is not reflected in the posted price. The Labor Department’s consumer-price index, which measures how much consumers pay for goods and services, rose to 7.5% in January compared with the same month a year earlier—the biggest rise since February 1982.”

CNBC: Watch all the commercials from the 2022 Super Bowl

Vining Sparks: Loan Trading: Consumer Lending

It is important to stay abreast of market changes in rates and potential credit concerns that may be creeping in that could impact production and performance. We welcome the opportunity to assist you in evaluating your portfolio for areas of opportunity or provide additional color on this dynamic market.

Vining Sparks Interest Rate Products: Margin Compression: Causes and Solutions

In this article, we examine why the industry is facing margin compression, challenge some of the more prevalent assumptions about banks’ risks profiles and highlight our best ideas for dealing with the current environment.

Vining Sparks: Coronavirus Chartbook and Coronavirus State Charts

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