[Federal Register Volume 64, Number 121 (Thursday, June 24, 1999)]
[Rules and Regulations]
[Pages 34106-34107]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-16133]
[[Page 34105]]
_______________________________________________________________________
Part VI
Department of Housing and Urban Development
_______________________________________________________________________
24 CFR Part 320
Ginnie Mae MBS Program: Book-Entry Securities; Final Rule
Federal Register / Vol. 64, No. 121 / Thursday, June 24, 1999 / Rules
and Regulations
[[Page 34106]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 320
[Docket No. FR-4331-F-02]
RIN 2503-AA12
Ginnie Mae MBS Program: Book-Entry Securities
AGENCY: Government National Mortgage Association, HUD.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This rule makes final the interim rule published on September
24, 1998, which revised the security issuance procedures for the
Government National Mortgage Association (``Ginnie Mae''). Under the
revised procedures, a certificated security is no longer issued for a
book-entry security. Currently, certificated securities are issued only
upon the request of the registered holder. The interim rule revised two
sections of part 320 to reflect this change. This final rule
accommodates the one public comment received.
DATES: Effective Date: July 26, 1999.
FOR FURTHER INFORMATION CONTACT: Thomas R. Weakland, Vice President,
Office of Program Administration, Government National Mortgage
Association, Room 6204, Department of Housing and Urban Development,
451 Seventh Street SW, Washington, DC 20410-0500. Telephone (202) 708-
2884 (voice). For hearing-and speech-impaired persons, this number may
be accessed via TTY by calling the Federal Relay Service at 1-800-877-
8339.
SUPPLEMENTARY INFORMATION: The Government National Mortgage Association
(``Ginnie Mae'') guarantees mortgage-backed securities of approved
issuers. On September 24, 1998, Ginnie Mae published an interim rule
which revised Ginnie Mae's security issuance procedures to adopt a true
book-entry system for the securities that it guarantees, instead of the
current system under which a certificated security is issued and
stored. Accordingly, the interim rule revised Sec. 320.5 to: (1) Revise
paragraph (a) to indicate that only physical securities will specify
payment and maturity dates; (2) indicate the date on and after which
physical securities will be issued only at the request of the
registered holder; and (3) establish when Ginnie Mae considers a book-
entry security to be guaranteed. The interim rule also revised the
language of Sec. 320.13 to conform with the book-entry system. The
interim rule was effective for securities issued on or after November
1, 1998.
The September 24, 1998 interim rule received one public comment.
The commenter, a depository, pointed out the need for certainty in
determining when delivery of uncertificated book-entry securities
occurs. This final rule revises the interim rule to accommodate the
public comment and to make other minor language changes. In addition,
Ginnie Mae is delaying the uncertificated book-entry process for serial
notes and securities backed by multifamily mortgage pools.
Findings and Certifications
Regulatory Flexibility Act
The Secretary, in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)), has reviewed and approved this final rule, and in so
doing certifies that this rule will not have a significant economic
impact on a substantial number of small entities. Ginnie Mae's
designated depository is the only entity affected by this revision, and
the designated depository is not a small entity. The final rule will
have no adverse or disproportionate economic impact on small
businesses.
Environmental Impact
This rulemaking is exempt from the environmental review procedures
under HUD regulations in 24 CFR part 50 that implement section
102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C.
4332) because of the exemption under 24 CFR 50.19(c)(1) which pertains
to ``the approval of policy documents that do not direct, provide for
assistance or loan and mortgage insurance for, or otherwise govern or
regulate property acquisition, disposition, lease, rehabilitation,
alteration, demolition, or new construction, or set out to provide for
standards for construction or construction materials, manufactured
housing, or occupancy.'' This rulemaking simply amends existing
regulations regarding the form of guaranteed securities.
Executive Order 12612, Federalism
The General Counsel, as the Designated Official under section 6(a)
of Executive Order 12612, Federalism, has determined that this final
rule will not have substantial direct effects on States or their
political subdivisions, or the relationship between the Federal
Government and the States, or on the distribution of power and
responsibilities among the various levels of government. No
programmatic or policy changes will result from this final rule that
would affect the relationship between the Federal Government and State
and local governments.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4; approved March 22, 1995) (``UMRA'') establishes requirements for
Federal agencies to assess the effects of their regulatory actions on
State, local, and tribal governments, and on the private sector. This
final rule does not impose any Federal mandates on any State, local, or
tribal governments, or on the private sector, within the meaning of the
UMRA.
List of Subjects for 24 CFR Part 320
Mortgages.
Accordingly, the interim rule published at 63 FR 51250, amending 24
CFR part 320 is adopted as final with the following changes:
PART 320--GUARANTY OF MORTGAGE-BACKED SECURITIES
1. The authority citation for 24 CFR part 320 continues to read as
follows:
Authority: 12 U.S.C. 1721(g) and 1723a(a); and 42 U.S.C.
3535(d).
2. Section 320.5 is amended by revising the last sentence of
paragraph (a), paragraphs (e) and (f), and by adding paragraph (g) to
read as follows:
Sec. 320.5 Securities.
(a) * * * The securities, if issued in certificated form, must
specify the dates by which payments are to be made to the holders
thereof, and must indicate the accounting period for collections on the
pool's mortgages relating to each such payment, and the securities, if
issued in certificated form, must also specify a date on which the
entire principal will have been paid or will be payable.
* * * * *
(e) Issue date. Securities with issue dates of October 1, 1998, or
before, have been issued in certificated form. Except for serial note
securities and securities backed by multifamily mortgage pools,
securities with issue dates of November 1, 1998, or thereafter, will be
issued initially in uncertificated, book-entry form. Following initial
issuance, certificated securities will be issued in exchange for
uncertificated securities at the request of the registered holder and
upon payment of any required fee. Serial notes and securities backed by
multifamily mortgage pools will continue to be issued in certificated
form until the applicable MBS Guide provides otherwise.
(f) Delivery. Delivery of uncertificated securities occurs when the
book-entry
[[Page 34107]]
depository's nominee is registered as the registered owner of the
securities on Ginnie Mae's central registry.
(g) Guaranty. The Ginnie Mae guaranty of uncertificated securities
becomes effective when the book-entry depository's nominee is
registered as the registered owner of the securities on Ginnie Mae's
central registry.
(Approved by the Office of Management and Budget under control
number 2503-0009)
3. Section 320.13 is revised to read as follows:
Sec. 320.13 Guaranty.
The Association guarantees the timely payment, whether or not
collected, of the interest on the outstanding balance and the specified
principal installments on securities that are registered on Ginnie
Mae's central registry. The Association's guaranty is backed by the
full faith and credit of the United States.
Dated: June 18, 1999.
George S. Anderson,
Executive Vice President, Government National Mortgage Association.
[FR Doc. 99-16133 Filed 6-23-99; 8:45 am]
BILLING CODE 4210-01-P
