Pipeline Perils: Managing Interest Rate Risk in Uncertain Markets
Wednesday, March 15, 2023, 1:00 p.m. central time
Session Description
Credit unions know that locking in mortgage interest rates for future closing dates gives members peace of mind. But what impact does this benevolence have on the financial institution itself? It might be time to start hedging your bets.
Any time a credit union provides a member with an interest rate lock commitment (IRLC), the institution assumes an unquantifiable financial risk tied to the daily fluctuations of the bond markets. Unfortunately, many credit unions have only a limited understanding of this risk and less-than-optimal methods of mitigating it.
Join capital markets experts Mark Teteris and Jordan Palmer from Optimal Blue to learn more about the risks associated with IRLCs (aka derivative assets). The pair will discuss how to apply analytical tools and the straightforward financial instruments available from FNMA/FHLMC to mitigate the risk of financial loss, improve your institution’s bottom-line results, and increase your success in the competitive mortgage lending arena.
You will walk away armed with the following knowledge:
- A thorough understanding of the theory behind hedging and hedging practices
- Familiarity with all hedging vehicles and their application relevance
- Adaptive strategies to consider during market fluctuations
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Speakers
Mark Teteris, CMB
Director, Solutions Specialists, Optimal Blue
Mark Teteris, CMB, began his mortgage industry career more than 20 years ago and has held roles in sales, operations, and executive leadership. As Director of Solutions Specialists at Optimal Blue, now part of Black Knight, Teteris leads a team of subject matter experts who consult and deliver a sophisticated suite of secondary marketing, data and analytics, and compliance solutions across the industry. Teteris is the past President of the Minnesota Mortgage Association, where he also served on the board of directors and chaired its legislative committee. He has also served on advisory boards for several national lenders.
Jordan Palmer
Team Lead, Senior Analyst, Hedging & Trading, Optimal Blue
Jordan Palmer is a team leader for Optimal Blue, a division of Black Knight, where he and his team focus on all aspects of the secondary market, monitoring trend analytics to provide clients with the best, most up-to-date information and techniques available to maximize profitability and limit risk positions. With more than 10 years in the mortgage industry, Jordan has held roles on the lock desk, assisted in front-end price generation, worked in operations, loan sales, and TBA and NRH trading. His credit union focus has been the transition and implementation of NRH hedge models to assist in mandatory delivery to the agencies.
Peter J. Benjamin, CMB
President, ACUMA
Peter J. Benjamin, CMB is the President of the American Credit Union Mortgage Association (ACUMA). A mortgage professional with 20 years of experience, Benjamin has held various positions throughout the mortgage industry including Senior Vice President of Mortgage Lending for Lafayette Federal Credit Union in Rockville, MD. During his time at Lafayette Federal, Benjamin led a high-performing mortgage team that exceeded production and budget goals each year, reduced the Credit Union’s cycle times to the industry-required timeframes; and improved the credit union’s application pull-through rate. As an association, Benjamin wants to see ACUMA members continue to foster the collaborative spirit that has made the association so great and work together to support the American Dream of homeownership. He sees ACUMA as a vital education arm that helps Member Credit Unions gain market share in the mortgage industry.
Optimal Blue supports the industry’s largest network for secondary market buyers and sellers. The company’s premier product, pricing, and eligibility engine – the Optimal Blue PPE – delivers deep, broad-reaching functionality that is currently used by 64% of the top 500 mortgage lenders in the U.S. to price and lock 42% of mortgages completed nationwide. Additionally, Optimal Blue’s trading platform is used to facilitate $700 billion of loan trades last year. For more information on Optimal Blue’s innovative, end-to-end secondary marketing automation, visit OptimalBlue.com
